DUBAI - Abu Dhabi's Mubadala is arranging a $2 billion revolving credit facility to refinance a $1.75 billion revolving loan it put in place three years ago, two sources familiar with the matter said on Wednesday.
The transaction is a rare loan deal in Gulf debt markets, where borrowers are increasingly issuing bonds to diversify their funding base and, more recently, to take advantage of favourable conditions across emerging markets.
The state investment fund signed the original loan in 2016 with a group of 21 international banks. A revolving loan is one that can be drawn, repaid and drawn again during the agreed lending period.
The new loan will have a five-year maturity and be provided by a large group of relationship banks, said the sources.
A spokesperson at Mubadala declined to comment.
Abu Dhabi merged Mubadala with International Petroleum Investment Co (IPIC) two years ago. One source familiar with the loan discussions told Reuters in November that the credit facility could be increased in size to include IPIC’s debt requirements.
Bonds have accounted for almost 70 percent of the debt raised in Gulf capital markets this year, Franklin Templeton said in a presentation on Wednesday.
(Reporting by Davide Barbuscia; Additional reporting by Stanley Carvalho; Editing by Kirsten Donovan) ((Davide.Barbuscia@thomsonreuters.com; +971522604297; Reuters Messaging: email@example.com))