Middle East Economic Survey
VOL. LV
No 32
6-Aug-2012
QATAR
Qatar Petroleum To Issue $1.28Bn �Samurai� Bond
State oil and gas producer Qatar Petroleum (QP) is planning to issue a 10-year �samurai� bond worth �100bn ($1.28bn) on 9 August. �Samurai� is yen-denominated debt issued in Japan by foreign entities. The move shows Qatar is trying to tap a fresh base of investors, said a Qatari banker, noting that the funds were not designated for any specific purpose. The issue is guaranteed by Japan�s export credit agency (ECA), the Japanese Bank for International Cooperation (JBIC), making it a covered bond. Strangely, QP is rated higher than JBIC, at AA by Standard & Poor�s and Aa2 by Moody�s Investors Service, versus AA- and Aa3. But the cover allows it to extend the tenor past the usual three-five years. Also, the JBIC �wrap� could encourage domestic investors who are unfamiliar with QP. QP mandated five Japanese banks to arrange the issue in March. They comprise Daiwa, Mitsubishi UFJ Morgan Stanley, Mizuho, Nomura, and SMBC Nikko.
On 1 August the QP team released price guidance of 30-35 basis points (bps) over benchmark yen swaps. This was revised from the initially considered 27-37 bps. QP�s only other international foray was in 2006 when it issued a $650mn five-year US dollar-denominated Eurobond, although the state of Qatar recently raised $4bn when it priced a sovereign sukuk (MEES, 16 July). Also, Qatari companies such as LNG producer RasGas have tapped international debt markets. QP�s 2006 bond was for $650mn with a maturity date of 30 May 2011. It carried a coupon of 5.579% and was priced at par, with a spread at 65 bps over treasuries. It was issued under rule 144a in order to permit participation by US buyers (MEES, 26 May 2006). Other Gulf entities have issued Samurai bonds. National Bank of Abu Dhabi became the first Middle Eastern financial institution to issue one in July 2011. Sized at �10bn ($127mn), it had a 15-year tenor.
Copyright MEES 2012.
