Saudi Arabia’s PIF selling three-tranche dollar green bonds

Goldman Sachs, JPMorgan and Standard Chartered Bank were hired as global coordinators for the debt sale expected to price later on Tuesday

By Reuters

Published: Tue 7 Feb 2023, 5:14 PM

Saudi Arabia’s sovereign Public Investment Fund (PIF) is selling US dollar-denominated green bonds in tranches of seven, 12 and 30 years, a bank document showed on Tuesday.

Initial price guidance was around 145 basis points (bps) over 3.5 per cent US Treasuries (UST) for the seven-year tranche, around 175bps over 4.125 per cent UST for the 12-year paper and around 215bps over three per cent UST for the 30-year bonds, the document showed.

PIF is the chosen vehicle of Crown Prince Mohammed bin Salman to drive an economic agenda aimed at cutting reliance on oil.

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Goldman Sachs, JPMorgan and Standard Chartered Bank were hired as global coordinators for the debt sale expected to price later on Tuesday. Each tranche will be of benchmark size, which typically means at least $500 million.

Also on the deal are BofA Securities, BNP Paribas, Citi, First Abu Dhabi Bank, HSBC and Morgan Stanley as active bookrunners, as well as Credit Agricole, GIB Capital, ICBC International Securities, Mizuho, SMBC Nikko and Societe Generale as passive bookrunners.

PIF, which manages more than $600 billion in assets, raised $3 billion in October with its debut bond sale, which was also a green issue. That sale comprised tranches of five, 10 and 100 years — the first green bond of that tenor.

PIF expects to invest more than $10 billion by 2026 in eligible green projects, including renewable energy, clean transport and sustainable water management, an investor presentation for the bonds sold in October showed.

By comparison, the fund has said it would invest about $40 billion domestically each year through 2025. — Reuters