Bahrain's oil and gas holding company nogaholding has successfully refinanced its $1.6 billion Murabaha facility and upsized it to $2.2 billion.
The new facility was structured as a dual-tranche (conventional and Islamic) sustainability-linked loan based on a Secured Overnight Financing Rate (SOFR), with a maturity date of September 2026.
Announcing the upsizing move, nogaholding said this was the company’s first sustainability-linked corporate financing facility, utilizing sustainability KPIs related to Green House Gas (GHG) emission reduction as well as safety measures, including Lost-Time Injury frequency rate.
This first-of-its-kind facility for nogaholding paves the way for sustainable funding in Bahrain, promoting ethical ESG-driven transactions within the energy sector and the region.
The top energy company received strong participation from regional banks across Saudi Arabia, the UAE, Kuwait, Bahrain and South Asia. The facility was more than two times oversubscribed, with participation from 22 banks, making it the largest sustainability-linked loan facility in Bahrain and the region.
Gulf International Bank (GIB) and Mashreqbank psc (Mashreq) together acted as the Initial Mandated Lead Arrangers and Bookrunners (IMLABs) for arranging the Facility, along with being the Sustainability Coordinators.
Al Ahli Bank of Kuwait – DIFC Branch, GIB, and Mashreq together acted as Joint Coordinators, the Initial Mandated Lead Arrangers, and Underwriters for the transaction. GIB was also appointed as the Sole Structuring Bank and the Global Facility Agent.
Commenting on the success, nogaholding Group CEO Mark Thomas said: "As we continue to develop our energy strategy for Bahrain, we are proud to have set the benchmark as the largest sustainability-linked refinance in the history of the kingdom, and to set a precedent with our dual-tranche sustainability-linked facility."
"We are pleased with the support we have received from banks across the region. With more than two times oversubscription, the participation of several financial institutions highlights our strong credit," noted Thomas.
"The refinanced facility will allow nogaholding to cover its CAPEX program for 2022 aimed at increasing scale and diversification of its oil and gas assets and achieving goals that align with the United Nations Sustainable Development Goals (SDGs) included in the Bahrain Economic Vision 2030," he added.
On the strong participation, Gulf International Bank CEO Jamal Al Kishi said: "We are delighted to have had the opportunity to work with nogaholding on this landmark transaction. The strong participation from investors was a testament to their confidence in both the company and the Bahraini economy."
"At the heart of the successful closure of this transaction was nogaholding’s commitment to Bahrain’s sustainability drive. GIB is particularly honored to have partnered with nogaholding on this sustainability-based funding initiative," noted Al Kishi.
Mashreq Group CEO Ahmed Abdelaal said: "As a leading regional financial institution with a global presence, Mashreq is keen to continue to play an active role in supporting Bahrain as well as the sustainable development of the region’s energy sector."
"We are therefore proud to have supported nogaholding as one of the joint coordinators, joint book runners, joint sustainability coordinators, and initial mandated lead arrangers in successfully refinancing its $1.6 bn Murabaha facility and upsizing it to $2.2 billion," stated Abdelaal.
The loan underscores nogaholding's commitment for action in the broader framework of decarbonization and energy transition. This transaction also underscores the growing commitment from regional investors and financial institutions to fund sustainability-linked transactions.
"We believe that collaboration between financial institutions, governments and energy stakeholders is key to meeting the financing challenges for the energy transition in the region. nogaholding can play a significant role in supporting Bahrain’s diversification efforts as it looks to shifts towards cleaner sources of energy. We look forward to deepening our relationship with the nogaholding and working with it on its future strategic funding requirements," he added.
Al Ahli Bank of Kuwait (DIFC Branch) Senior Executive Officer Tom Lind said: "“The successful conclusion of this transaction, which was well received in the regional loan markets, emphasizes the importance and stature of nogaholding as a prime issuer in the Middle East and also underscores the capabilities of regional banks to engage in sustainable financing solutions."
"We thank the transaction team of nogaholding and our colleagues at GIB and Mashreq Bank for their good cooperation," he added.
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