Logo of Alkhabeer Capital
Alkhabeer Capital will start today, April 28, offering the units of Alkhabeer Diversified Income Traded Fund 2030 on the Saudi Exchange (Tadawul).
The offering will run 15 days until May 19, 2024.
For more news and details on Mutual Funds
Alkhabeer Diversified Income Traded Fund 2030 is a Shariah-compliant closed-ended traded investment fund established in accordance with the applicable laws and regulations of the Shariah Supervisory Committee.
The fund targets a total offering of 100 million units at an initial price of SAR 10 each, with a target capital of SAR 1 billion.
According to the offering prospectus, the IPO period can be extended for 20 business days until June 16, 2024.
The categories, or the target investors that are entitled to subscribe to the offering are natural persons holding the Saudi nationality or the nationality of other GCC countries, as well as corporations, companies, investment funds and other legal entities established in Saudi Arabia and other GCC countries. They also include foreigners residing in Saudi Arabia, and qualified foreign financial institutions licensed in accordance with the rules for the investment of qualified foreign financial institutions in listed securities, issued by the CMA. This is in addition to other investors that may be permitted by the CMA to own Tadawul-listed equities.
The Capital Market Authority (CMA) approved, in March, to offer the fund’s units in an IPO.
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Fund Information |
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Fund Manager |
Alkhabeer Capital |
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Fund’s Name, Type and Category |
A Shariah-compliant closed-ended traded investment fund established in accordance with the applicable laws and regulations of the Shariah Supervisory Committee. |
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Investment Objective |
The fund’s investment objective is to generate periodic income for investors through investing in income-generating assets by way of an investment structure compliant with the guidelines of the Shariah Supervisory Committee. |
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Target Fund Capital |
SAR 1 bln |
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Minimum Target Capital |
SAR 300 mln |
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Number of Units |
100 mln |
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Initial Offering Price |
SAR 10 per Unit |
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Offering to Institutional Investors |
5% minimum of the offered units and 70% maximum. In case the offering was undersubscribed, the remaining units will be allocated to the public. |
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Offering Date |
15 days from April 28 until May 19, 2024 |
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Extension of Offering Period |
The offering can be extended to 20 business days until June 16, 2024 |
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Start of Units Trading |
June 16, 2024, or July 14, 2024, in case of extending the offering |
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Surplus Refunds (If Any) |
July 14, 2024 |
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Fund Term |
Six years as of the listing date in Tadawul on June 9, 2030, or July 7, 2030, if the term is extended |
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Risk Level |
Investment in the fund involves a high level of risk |
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Minimum Subscription |
SAR 1,000 |
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Benchmark |
It is a composite index comprising 70% of the Dow Jones Sukuk Investment Grade Total Return + 30% of the Secured Overnight Financing Rate for three months (SOFR 3M) |
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Subscription Fees |
1% of the cash subscription amounts, to be paid upon subscription during the IPO period |
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Fund Management Fees |
1% annually of NAV |
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Dividend Payment Policy |
The fund will distribute dividends (if any) within 40 business days after the date of issue of the semi-annual or annual financial statements in each Gregorian year. The distributions (if any) will be announced within 10 business days after the date of issuing the financial statements |
The fund’s investment objective is to generate periodic income for investors through investing in income-generating assets by way of an investment structure, which is compliant with the guidelines of the Shariah Supervisory Committee.
The fund will invest in various income-generating asset types such as Sukuk, trade finance, senior secured loans, structured income notes, income funds and Murabaha.
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Fund’s Primary Underlying Type(s) of Securities |
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Investment Type |
Details |
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Sukuk |
Investment shall be made in sovereign, quasi-sovereign or corporate Sukuk that are issued locally and internationally by way of a public offering or private placement, whether listed or unlisted, and comply with the Shariah guidelines |
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Leasing Transactions |
Investment in leasing transactions shall be made through a diversified portfolio consisting of medium-term leasing contracts that are Shariah-compliant, used to supply different types of equipment in multiple sectors, spread across international markets outside Saudi Arabia, and subject to the laws and regulations issued by the financial and supervisory bodies regulating these markets |
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Trade Finance Transactions |
Investment in trade finance transactions shall be made through a diversified portfolio of short-term and asset-backed and/or insurance-backed trade finance transactions. They shall be Shariah-compliant spread across international markets outside Saudi Arabia, and subject to the laws and regulations issued by the financial and supervisory bodies regulating these markets |
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Structured Income Notes |
Investment in credit securities issued by governments and/or companies, or through private finance transactions executed in global markets outside Saudi Arabia, by way of a Shariah-compliant structure. |
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Senior Secured Loans |
Investment in senior secured loans shall be by way of structured financing tranches. These are securities comprised of senior secured loans of different investment grades and different preferences in the accrual of returns. They include corporate loans to diverse companies in terms of activities and sectors. They are granted by brokers outside Saudi Arabia. |
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Income Funds |
Investment shall be made in income funds that are managed by fund managers |
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Murabaha Transactions |
The fund manager may invest in Murabaha directly with local, regional or international banks with investment-grade credit and regulated by the Saudi Central Bank or a comparable regulatory authority in case of investment outside Saudi Arabia. |
The fund manager acknowledges that the trade finance, leasing and private finance transactions do not conflict with the investment funds regulations, other regulations and any law in effect in the Kingdom, including the special instructions on the direct financing investment funds.
Alkhabeer Capital further acknowledges that the Murabaha transactions executed by the fund manager will be entered into with counterparties in which the fund manager or its affiliates are not parties.
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Fund Investment Concentration Locally, Abroad |
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Investment Type |
In Saudi Arabia |
Abroad |
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Minimum |
Maximum |
Minimum |
Maximum |
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Sukuk * |
-- |
100% |
-- |
100% |
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Trade Finance Transactions |
-- |
-- |
-- |
100% |
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Leasing Transactions |
-- |
-- |
-- |
100% |
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Senior Secured Loans |
-- |
-- |
-- |
100% |
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Structured Income Notes |
-- |
-- |
-- |
100% |
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Income Funds * |
-- |
100% |
-- |
100% |
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Murabaha Transactions* |
-- |
100% |
-- |
100% |
*As per available opportunity and the fund manager’s discretion based on local and global economic conditions.
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Percentages of Investment Types |
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Investment Type |
Minimum |
Maximum*** |
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Sukuk |
-- |
40% |
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Trade Finance Transactions |
-- |
40% |
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Leasing Transactions |
-- |
40% |
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Senior Secured Loans |
-- |
40% |
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Structured Income Notes |
-- |
40% |
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Income Funds * |
-- |
25% |
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Cash & Murabaha Transactions** |
-- |
20% |
*In the event the income funds invest in any of the aforementioned types of assets, the limits of investment in those funds shall be independent of the limits specified for each type of investment.
**In normal circumstances, the fund manager will not hold cash or invest in Murabaha transactions in excess of 20% of the fund’s net asset value (NAV). However, in case of the sale of some investments (until the cash is re-invested), or in exceptional cases, the allocation to cash and Murabaha transactions may be increased up to 100% of the fund’s NAV.
***In the event any of the target asset types exceeds its investment limit due to changes in underlying asset valuations caused by market changes, the fund manager shall be entitled not to rebalance the portfolio in line with the limits specified in the table above.
According to the prospectus, the maximum investment limits shall not be binding to the fund manager starting from the end of the fifth year after the listing date, as the fund manager shall concentrate investments in short term assets and/or liquid assets to ensure exit at the end of the fund’s term.
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Fund Information |
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Lead Manager |
AlJazira Capital |
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Receiving Banks |
AlJazira Capital, SNB Capital, Riyad Bank, ANB, Al Rajhi Bank, Banque Saudi Fransi, Alinma Bank, and Alkhabeer Capital |
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