Saudi Hollandi Bank closes Islamic financing for Zamil & Huntsman petrochemical project

Saudi Hollandi Bank acted as the sole Lead Arranger and underwriter for the transaction. The deal signifies growing trend for 100% Shariah-compliant project financings in KSA.

The $289mn project comprises the design, engineering, procurement, construction and financing of a 27,215 tpa ethyleneamines plant and associated utilities in the Jubail Industrial City, Saudi Arabia under Arabian Amines Company with both Huntsman SA Investment Corporation (a subsidiary of Texas-based petrochemical company Huntsman Corporation) and Saudi-based global industrial and investment conglomerate, Zamil Group being the co-sponsors.

The transaction consists of Murabaha and Ijara tranches duly approved by the Shariah Board of Saudi Hollandi Bank.

Allen & Overy acted as legal advisors for Saudi Hollandi Bank whereas Clifford Chance acted as sponsors' legal advisor.

Commenting on the conclusion of this landmark transaction, Mr. Sattam Al-Zamil, the Zamil Group General Manager for Finance said

We are pleased to achieve Islamic financing for this transaction and are grateful to Saudi Hollandi Bank and other parties who made it happen.

Mr. Ibrahim I. Behairi, CEO of Arabian Amines Company commented

"This transaction is strategically important for further development of petrochemical sector in the Kingdom."

Ed Mendoza, Head of Structured Finance & Syndications at Saudi Hollandi Bank said

"We are delighted to arrange and underwrite this financing both for Huntsman and Al-Zamil group, a key bank client. We are seeing a growing trend in the Middle East markets for completely Shariah-compliant project financings (rather than merely taking Islamic tranches to conventional debt financings), as global players are keen to penetrate the GCC's liquidity by adapting to market demands in the region."

The Arabian Amines Company aims to be one of the leading derivatives petrochemicals players in the region by being innovative and setting the standards for the market.

Saudi Hollandi Bank is also seeking to be a leader in offering Islamic financing solutions in the Kingdom which is one of the fastest growing markets for Islamic banking & finance. This innovative transaction allows both institutions to achieve their objectives, said Mr. Kamal Mian, head of Islamic banking at Saudi Hollandi Bank.