Saudi Electricity Company plans to raise money by issuing sukuk in US dollars
Saudi Electricity Company (SEC) plans to raise money by issuing dollar-based sukuk as part of its current sukuk program, according to a report released on Monday.
Sukuk Issuance
The company started meeting with investors on Monday, as stated in its filing to the Saudi Exchange (Tadawul).
The sukuk (Islamic bonds) will be offered through a special-purpose company to eligible investors in the Gulf region and internationally.
The money raised will be used for the electricity company’s general needs, including spending on new projects.
SEC, one of the largest utility companies in the region and the only provider of electricity transmission and distribution in Saudi Arabia, said that the total amount to be raised will be decided later based on market conditions and its financial needs.
The sukuk offer depends on approval from regulators and will follow all legal requirements.
The company has appointed several banks, including HSBC, Standard Chartered, Abu Dhabi Commercial Bank, First Abu Dhabi Bank, Mizuho, MUFG, SMBC, BNP Paribas, Dubai Islamic Bank, and others, to help manage the sukuk issuance.
Syndicated Loan
In December last year, Saudi Electricity Company signed a $3.6 billion (SAR 13.5 billion) international loan agreement with 13 regional and global banks. These included ICBC, Bank of China, China Construction Bank, Abu Dhabi Islamic Bank, Dubai Islamic Bank, and the State Bank of India.
In February 2024, SEC raised $2.2 billion by issuing sukuk in two parts, which were listed on the London Stock Exchange. The first part was a five-year sukuk worth $800 million with a fixed annual profit rate of 4.9%. The second part was a 10-year sukuk worth $1.4 billion with a 5.2% profit rate.
Published: 11th February 2025
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