SEC issues largest ever Saudi sukuk

HSBC Saudi Arabia was the Sole Lead Manager and Sole Bookrunner for the SAR 5 billion issue.

SEC delivered a compelling message to investors during the 10-day period roadshow period, during which the order book built up quickly to almost SAR 7 billion, nearly three times SEC's issuance target of SAR 2.5 billion. This overwhelming demand allowed SEC to issue a sukuk worth SAR 5 billion, the maximum permitted by the Saudi regulatory authorities

The sukuk priced at 45 basis points over the benchmark, a figure that represents a substantial saving from the cost of SEC's existing loans. Investors comprised a diversified mix of pension and mutual funds, insurance and Takaful companies, corporates and banks (both Saudi and foreign banks with a Saudi branch).

SEC's Acting Chief Executive Officer, Eng. Yousif Balghanaim said:

"SEC is pleased to complete this landmark Sukuk issue of SAR 5 billion, the largest ever Sukuk or bond issued by a Saudi company. This successful Sukuk issuance follows the recent ("A+") rating assigned to SEC by Fitch and Standard & Poors - both at the sovereign ceiling. The company's recent ratings and the new financing flexibility established through tapping the diversified capital markets establishes SEC as a fundamentally strong credit-worthy institution, and the company is determined to use this financial flexibility to support its endeavours in meeting the Kingdom's power needs through the provision of reliable and efficient services. SEC is also pleased to contribute to the development of the Islamic Finance industry and capital markets through the issuance of the Sukuk in the Kingdom."

HSBC Saudi Saudi Arabia's Chief Executive Officer, Timothy Gray said:
"We are delighted to have advised and supported SEC in obtaining its excellent debut credit ratings from S&P and Fitch, and in lead managing its landmark debut Sukuk issuance. SEC plays a fundamental role in the Kingdom's economy, and we are proud to have contributed to its financing success which we hope will support the Kingdom's growth at this important juncture. HSBC prides itself on delivering innovative solutions to clients, and through this recent issuance -- the largest Sukuk/bond ever by a Saudi Arabian issuer -- we are extremely happy to have been able to deliver yet another successful Sukuk, demonstrating our ongoing commitment to the Kingdom and its key institutions".