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Saudi shipper Bahri hopes to issue sukuk this quarter -exec

Bahri became the sole provider of very large crude carrier (VLCC) crude oil shipping services to Saudi Aramco

RIYADH, May 6 (Reuters) – National Shipping Company of Saudi Arabia (Bahri) plans to make a debut sukuk issue worth up to 3.9 billion riyals ($1.04 billion) this quarter, the company’s vice chief executive officer for finance Mohammad Alotaibi said on Wednesday.

“Hopefully in this quarter,” he told Reuters when asked about the timing of the issue.

“This is our first time in the sukuk market and I think it’s good for the company to tap into the sukuk market for diversification purposes. Hopefully we will continue to be active in both sukuk and also working with our banks.”

Bahri had previously said it planned to make the issue by the end of March this year and that the tenor would be 10 years. On Wednesday, Alotaibi declined to specify the tenor: “We are looking at it, we have not decided yet.”

HSBC Saudi Arabia, JP Morgan and Samba Capital, the investment banking arm of Samba Financial Group, are arranging the transaction.

Bahri became the sole provider of very large crude carrier (VLCC) crude oil shipping services to Saudi Aramco after it bought the marine unit of the oil giant in a deal first announced in 2012 but which was completed last year.

The purchase of Vela, which made Bahri the world’s fourth-largest owner of VLCCs, was backed by shares in itself and a 3.18 billion riyal bridge loan, which it said last June would be replaced by long-term, sharia-compliant financing within 12 months. (Reporting by Reem Shamseddine and Marwa Rashad; Writing by Andrew Torchia)