The fixed-rate dollar sukuk by Dubai, whose order book is reported to have crossed $1.5 billion (Dh5.5bn) on active demand, is likely to be priced in the range of 6.5-6.7 per cent, according to analysts.

The order book for the second part of the issue, which is a floating-rate dirham sukuk, is more than Dh3.5bn. It is likely to be priced at 375 basis points above the three-month Eibor, which was 1.955 per cent on the Central Bank website yesterday.

However, a source involved with the offering, told Emirates Business: "The deal is not over yet. We have not yet finalised the size and terms of the transaction."

An official announcement is expected today.

Investors participating in the sukuk programme, initiated by Dubai Government and which is the second one from the emirate in the past two years, said the fixed-rate dollar sukuk will yield 375 basis points above five-year mid-swap and this could mean that the pricing is likely to fall in the range of 6.5 per cent to 6.7 per cent as mid-swap was hovering around 2.85 per cent yesterday.

"As of yesterday's level, the floating-rate dirham sukuk can have an indicative pricing in the region of 5.75 per cent as of yesterday," said an analyst. The dirham sukuk has so far attracted an order book of Dh3.5bn, he said.

The five-year paper, which was launched with the roadshow in Hong Kong on Thursday has already concluded roadshows in Dubai and London. The last of the series is in Frankfurt.

By CL Jose

© Emirates Business 24/7 2009