Saturday, Dec 01, 2012
By Summer Said and Iman Dawoud
Of ZAWYA DOW JONES
DUBAI (Zawya Dow Jones)--Saudi's National Industrialization Co. (2060.SA), or Tasnee, is considering a second shariah-compliant sukuk next year to help bank roll its expansion and refinance existing debt, the company's chief executive said.
The firm completed its debut Islamic bond in May, a 2 billion Saudi riyals ($533.3 million) issue that was more than two times oversubscribed. Tasnee has a SAR5 billion sukuk program in place.
"So far our sukuk program received an excellent reception in the market...Our program it is up to the total equity of the company so it can go up to over SAR5 billion," Moayyed al-Qurtas told Zawya Dow Jones in an interview in Dubai late last week. When asked if the firm is considering issuing more sukuk next year, Mr. Qurtas said "yes, absolutely."
Recent Saudi sukuk sales have attracted a flood of investors, making them an attractively priced alternative to bank financing. Saudi Electricity Co.'s $1.75 billion sukuk earlier this year received orders worth more than $17.5 billion, according to the company. The largest of issue this year was a SAR15-billion sukuk by the General Authority for Civil Aviation in January.
Like its industry peers in the Gulf Arab region, Tasnee, which claims to be one of Saudi Arabia's largest petrochemicals firms by output volume, benefits from cheap access to feedstock in the oil-exporting region. And while the company's primary focus is domestic, it continues to look for opportunities to expand globally.
"Obviously we will look for opportunities worldwide...we will not put restrictions," Mr. Qurtas said.
Persian Gulf-based petrochemical manufacturers, including Sabic, have previously benefited from improved economic conditions that have boosted demand for petrochemical products and plastics, used in consumer goods and such industries as automobiles. A deteriorating global economy has reversed this trend however.
"Right now the international economy is not at its best conditions...however overall, we are optimistic that growth is resuming. We see a lot of signs of growth ongoing," Mr. Qurtas said, adding he expects both petrochemical prices and demand to improve next year.
Write to Summer Said at summer.said@dowjones.com and Iman Dawoud at iman.dawoud@dowjones.com
Copyright (c) 2012 Dow Jones & Co.
(END) Dow Jones Newswires
01-12-12 0730GMT
