Tabreed raises $500m in bond sale

Dubai - The issuance was oversubscribed almost five times at its initial size of $400 million

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A Staff Reporter

Published: Thu 22 Oct 2020, 2:03 AM

District cooling firm Tabreed on Wednesday said it raised $500 million (Dh1.8 billion) with a seven-year, 2.5 per cent coupon bond issuance.

The issuance was oversubscribed almost five times at its initial size of $400 million. This significant demand allowed Tabreed to tighten pricing significantly to achieve a final coupon of 2.5 per cent and to increase the size of the final bond to $500 million. The bond is rated Baa3 by Moody's and BBB by Fitch, in line with Tabreed's corporate ratings.

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The 7-year bond was particularly well received by international investors, who accounted for 90 per cent of the final geographical allocation, with 49 per cent from Europe, 21 per cent from Asia and 20 per cent from offshore US funds. The bond will be listed on the London Stock Exchange, alongside Tabreed's existing 2025 Sukuk.

Khaled Abdulla Al Qubaisi, chairman of Tabreed, said: "The success of the issuance is proof of the continued confidence in Tabreed and its ability to generate sustainable cash flows and returns. Our solid fundamentals and strong credit ratings have translated into unprecedented market appetite, and I am proud to say that this has enabled us to attract significantly oversubscribed demand from a diverse pool of investors. This is also a vote of confidence from investors in Tabreed's future and the growth potential of the organisation."

JP Morgan and HSBC acted as joint global coordinators and bookrunners for the issuance, with Commercial Bank of Dubai acting as a joint lead manager.

- waheedabbas@khaleejtimes.com

A Staff Reporter

Published: Thu 22 Oct 2020, 2:03 AM

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