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Dewa may sell 5-year dollar bonds at 8.5 per cent: Banker

DUBAI — Dubai Electricity & Water Authority, a state-owned utility, plans to sell five-year dollar-denominated bonds this week that may yield 8.5 per cent to 8.625 per cent, according to a banker involved in the transaction.

The benchmark sale may be completed as early as tomorrow, said the banker, who asked not to be identified because details are private. The company hired Citigroup Inc., Standard Chartered Plc, Royal Bank of Scotland Group Plc and National Bank of Abu Dhabi PJSC to arrange the sale. Benchmark is typically at least $500 million.

Dubai Electricity, or DEWA, said on March 2 it may raise $1 billion to $1.5 billion in the second-quarter of the year by selling bonds. It would be the first Dubai government-owned entity to tap debt investors since Dubai World roiled global markets in November by proposing a freeze on loan repayments.

The Dubai government’s $1.93 billion Islamic bond issued in October was the last sale of notes from the emirate. Debt sales from the Gulf, including Saudi Arabia-based Banque Saudi Fransi and the state-owned National Bank of Abu Dhabi PJSC, total $3.4 billion this year, according to data compiled by Bloomberg.

National Bank of Abu Dhabi sold $750 million of five-year bonds on March 18, becoming the first United Arab Emirates entity to tap capital markets since state-owned Dubai World said last year it was seeking to restructure $26 billion of debt. —