Dammam – Saudi Arabia, 26 September 2018: — The Arab Petroleum Investments Corporation (APICORP), the multilateral development bank focused on the energy sector, announces the pricing of a $750 million 5-year bond (rated Aa3 by Moody’s) on September 11, 2018 in the RegS/144a markets. The USD transaction was issued under APICORP’s newly established $3 billion Global Medium Term Note (GMTN) programme, to provide the company with maximum flexibility in accessing capital markets and further strengthen its financial position.
APICORP was the first corporate to issue in the MENA bond and sukuk market since mid-May 2018. The oversubscribed orderbook, which exceeded $3.5 billion, sent a clear signal to the market on investor appetite and paved the way for other regional issuers to follow. This marks a significant step for APICORP in implementing a diversified funding strategy that will enable it to fulfil its developmental mandate in support of the growth and transformation of the energy sector in the Arab world.
Dr. Ahmed Ali Attiga, APICORP’s Chief Executive Officer, commented: “We are delighted to produce another example of APICORP demonstrating its financing flexibility as it continues to grow its business. Being able to complete transactions of such profile and with such a wide and international investor base is not only an endorsement of our strong balance sheet, but is also in line with our strategy of diversification. We issued a very successful sukuk in October 2017, which was placed primarily in Asia and Europe. Now, with this latest transaction, we have successfully reinforced our strong relationship with the global investor base, and in particular the important and deep US investment community.”
The deal is the third benchmark issue for APICORP following a highly successful sukuk in October 2017, which was issued off another $3bn RegS sukuk programme. Given APICORP has previously only accessed the public Sukuk, regional local currency and Asian private placement markets (with the Formosa and Dim Sum bonds), a key objective for the company for this issuance was to achieve deeper access into western portfolios, with a focus on US accounts. With over 80% of the deal placed with international accounts i.e. outside of the Middle East, and 36% of the bonds allocated to first-time US investors, the deal went a long way towards achieving APICORP’s diversification objectives.
The Joint Lead Managers and Bookrunners included Credit Agricole CIB, HSBC, JP Morgan and Standard Chartered. The co-managers included Bank ABC, First Abu Dhabi Bank and Union National Bank.
Pierre Blandin, Managing Director, Global Head of SSA DCM at Credit Agricole CIB commented: “APICORP’s team did a great job in presenting and positioning the credit. The success of this transaction is a testimony to the strong connection built with the global investor base, firmly putting APICORP on the RegS/144A map.”
Nick Darrant, Head of J.P. Morgan CEEMEA Syndicate commented: “The success of this deal is testimony to the unique risk profile of APICORP, the track record of management, and their strategy to diversify the borrowing plan into a truly global offering.”
Adam Bothamley, Managing Director, Global Head of Debt Syndicate at HSBC commented: “The deal had an excellent and balanced distribution that reflects the credit profile of APICORP itself as well as the great work that APICORP’s management have done in educating international investors. The transaction reflects the continued success for APICORP’s diversified funding channels that include SUKUK, multiple currencies in conventional format as well as Formosa.”