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Saudi Arabia’s Public Investment Fund (PIF) backed 10-year $2 billion Reg S bond was launched at par with a reoffer price of 99.977%. It has a final coupon rate of 5% and the yield is set at 5.003%.
The price was tightened from initial T+120 bps area, with the spread set at T+95 and a par call of 100% (plus accrued and unpaid interest) on or after the date falling three months prior to the maturity date.
Order books for the senior unsecured bond peaked at $7.75 billion, excluding JLM interest.
The bond was launched by GACI First Investment Company, a special-purpose vehicle (SPV) of Saudi’s sovereign wealth fund, with PIF stepping up as a guarantor, under its Euro Medium Term Note Programme.
PIF has a rating of Aa3 (Stable) by Moody’s / A+ (Stable) by Fitch, with the issue rating on par.
The bond is listed on the London Stock Exchange’s International Securities Market, with proceeds to be used for general corporate purposes.
The settlement date has been set for September 15.
Citi, HSBC and JP Morgan were joint global coordinators, while Bank of China, BNP Paribas, Goldman Sachs, ICBC, Standard Chartered were named Joint Active Bookrunners. Barclays, BofA, and Mizuh were appointed as Joint Passive Bookrunners.
The state-backed PIF, which has an estimated $1.15 trillion in assets under management, has been tapping the debt markets since January, raising $4 billion from a two-tranche deal.
In April, the Saudi sovereign wealth fund raised $1.25 billion through a 7-year sukuk, marking its second bond market tap, as the kingdom continues to build huge infrastructure and tourism projects aimed at diversifying its economy away from oil.
Last week, Saudi Arabia also raised a further $5.50 billion from the sale of dual-tranche dollar-denominated Islamic bonds.
(Writing by Bindu Rai, editing by Seban Scaria)
