Dubai: Saudi Telecom Company has issued a debut Islamic bond worth 2 billion Saudi riyals ($533.3 million) after receiving good demand, the majority government-owned telco said on Tuesday.
Several regional companies are rushing to tap the debt market ahead of an expected slowdown in regional investor activity deeper in the summer months and during Ramadan in July.
The 10-year Islamic bond, or sukuk, carries a floating profit rate of 70 basis points over three-month SIBOR and was offered under its newly established 5 billion Saudi riyals private placement sukuk program, STC said in a statement posted on the Saudi bourse website.
“This debut Sukuk issuance of STC was almost two times oversubscribed. The investor base captured was diverse comprising a mix of government investors, banks, asset managers and insurance companies,” the Gulf’s largest telco by market value noted. The order book was open from June 1 to 3.
J.P. Morgan Saudi Arabia, NCB Capital Co. and Standard Chartered Capital Saudi Arabia were joint arrangers of the sukuk program as well as joint managers on the debut issue.
