Wednesday, Jun 15, 2011
(Adds analyst comment in the 5th paragraph, background in the 8th paragraph.)
DUBAI (Zawya Dow Jones)--The price guidance for the government of Dubai's planned U.S. dollar-denominated, benchmark-sized bond is 375 - 385 basis points over five-year mid swaps, a banker familiar with the matter said Wednesday.
The new bonds are of 10 years maturity with a five-year put option under its existing Euro Medium Term Note, or EMTN, program and will be listed on the London Stock Exchange and the Dubai Financial Market. "Books to go subject at short notice," the banker, who declined to be identified, told Zawya Dow Jones. "Trading is almost flat in the grey market," he added.
Emirates NBD, HSBC, RBS and UBS are book runners on the new issue.
Earlier this month Dubai flag carrier Emirates Airline issued a five-year, $1 billion bond with a spread of 330 basis points over five-year mid swaps.
"Dubai's pricing was always expected to be wider compared with that of Emirates Air, but it's still quite good from the emirate's point of view," said one analyst at an Abu Dhabi-based bank.
A series of meetings with fixed-income investors was scheduled in London on Monday and Tuesday, with the Dubai bond expected to launch and price this week, subject to market conditions, the banker said.
The government of Dubai earlier this week, in its base prospectus, said it increased the size of its EMTN program to $5 billion, from $4 billion previously, as the debt-laden state looks to raise more cash to bridge its budget deficit and finance growth.
Several companies in the U.A.E. have, or are in the process of, tapping the bond market. A senior Deutsche Bank executive said Tuesday the wider Middle East and North Africa primary bond market may reach or exceed last year's value of $40 billion on the back of improved pricing and increased borrowing requirements.
-By Nikhil Lohade, Dow Jones Newswires, +9714 446 1694, nikhil.lohade@dowjones.com
Copyright (c) 2011 Dow Jones & Co.
(END) Dow Jones Newswires
15-06-11 1041GMT
