Medtech Diagnostics, a private company specializing in healthcare equipment, machinery, and consumables, is set to issue a sukuk in the Maldives for the construction of a health and rehabilitation center in Hulhumale’. This marks the first time a private company in the Maldives has opened up to sell a Sukuk.
A sukuk is an Islamic financial instrument, similar to a bond, designed to generate profits for investors. Each Sukuk is backed by an asset that generates income or profit, with the profits being distributed to investors using the income from the underlying assets. The Sukuk issued by Medtech will be offered for MVR 30 million and will have a yield of 9% per year, with profits distributed twice annually. The term of the security is seven years.
According to First National, the lead arranger of the Sukuk, the Sukuk issued by Medtech will pave the way for other private companies to participate in the Islamic capital market. Dr. Aishath Muneeza, First National’s Islamic Finance Advisor, said that the Sukuk is a vital tool for private companies to raise funds, and the Medtech Sukuk is an important milestone in the development of the Islamic finance industry in the Maldives.
By issuing the Sukuk, Medtech is looking to raise funds to construct a health and rehabilitation center in Hulhumale’, which will cater to the needs of the local community. The Sukuk is listed on the Viyana portal of the Maldives Stock Exchange as a private placement.
The issuance of Sukuk allows companies to raise funds while providing investors with an opportunity to invest in ethical and socially responsible projects. This marks a new beginning for private companies in the Maldives to participate in the Islamic capital market and is expected to pave the way for many more to raise funds through this type of securities.
