Saudi Basic Industries Corporation (Sabic) won regulatory approval to sell Islamic bonds worth as much as 5 billion riyals ($1.33 billion), the kingdom’s stock market regulator said on Monday.
In July, the world’s largest chemical company by market value said it planned to raise up to $5 billion through a programme of Islamic bonds to fund expansion. That month, the company sold Islamic bonds, or sukuk, worth $2.13 billion.
HSBC Holdings is the lead manager of Sabic’s latest sukuk sale, and the five-year bonds will be denominated in riyals, a person close to the deal said, adding that a roadshow to market the sukuk starts next week.
The bonds highlight investor appetite for securities denominated in Gulf currencies – of which all but Kuwait’s are pegged to the falling US dollar – on speculation countries in the region may revalue to stave off rising inflation.
There has been a lull in sukuk sales after a global credit crunch triggered by defaults in US home loans last summer, but a handful of firms have come to market with sukuk offerings in recent weeks.
RELATED: Nakheel sets $1bn bond price guidence
Sukuk comply with Islam’s ban on the payment or receipt of interest, and returns are derived from underlying physical assets.
The approval was posted on the Saudi bourse website.
Follow us on
