KARACHI: State Bank of Pakistan on Tuesday revised the transaction structure of the government of Pakistan domestic Ijara Sukuk on Jinnah International Airport Karachi (JIAP), pursuant to discontinuation of Trust Act 1882, a circular said.
“The future issuances of Ijara Sukuk on JIAP Karachi as underlying asset, and reopening there against, will be carried out under the revised transaction structure and documentations following the repeal of the Trust Act 1882,” the central bank said in its circular.
It added that the documentation for this structure would include a Sukuk subscription and issuance undertaking, purchase agreement, title agency agreement, and cost undertaking and rules. “The Jinnah International Airport Karachi together with identified, unencumbered and undisputed land of Civil Aviation Authority (CAA) surrounding the JIAP, identifiable by survey numbers and area, have been identified as the proposed Assets to facilitate issuance of GoP Ijarah Sukuk,” said the circular.
“Valuation of the Assets is to be carried out by two PBA [Pakistan Banks Association] approved independent valuators, and the lower of the two valuations will be accepted as the sale price of the Assets.”
The SBP further said it would conduct an auction through which Sukuk investors would be identified. Non-competitive bidders may also submit their bid for the Sukuk, it added. The investors would execute the Sukuk subscription undertaking to record the commitments of the Investors to subscribe to the Sukuk to be issued by Pakistan Domestic Sukuk Company Limited (PDSCL), it noted.
Under the Sukuk subscription undertaking, the investors may appoint PDSCL as their agent (investment agent”) for purchase of the assets on their behalf and for the purposes set out in Sukuk issuance undertaking.
The SBP said the primary dealers would also sign the subscription undertaking on behalf of successful non-competitive bidders. PDSCL (as agent of Investors) and SBP’s Banking Services Corporation would execute an Agency Agreement whereby PDSCL would appoint SBP-BSC as its agent to collect proceeds from the investors, collect rentals and other payments due from the government and distribute the same to the Investors, and act as reference agent and registrar for the investors.
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