Tabreed raises $500m with new 7- year bond
Issuance was oversubscribed almost 5 times at its initial size of $400 million
Dubai: National Central Cooling Company (Tabreed), the leading District Cooling developer headquartered in the UAE, on Wednesday announced that it has raised $500 million (Dh1.8 billion) with a 7-year, 2.5 per cent coupon bond issuance.
With orders coming from around 140 high quality local and international investors, the issuance was oversubscribed almost 5 times at its initial size of $400 million, demonstrating strong investor confidence in Tabreed’s solid credit fundamentals, despite current global economic uncertainty. 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.
The 7-year bond was particularly well received by international investors, who accounted for 90% of the final geographical allocation, with 49% from Europe, 21% from Asia and 20% from offshore US funds. The bond will be listed on the London Stock Exchange, alongside Tabreed’s existing 2025 Sukuk.
“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 thegrowth potential of the organization,” said Khaled Abdulla Al Qubaisi, Tabreed Chairman.