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21 November 2019

Saudi Arabia’s Arabian Centres issues $500 million five-year Sukuk

The fixed-rate, dollar-denominated Sukuk, carries a coupon rate of 5.38 per cent and was four times oversubscribed—with non-GCC international investors accounting for 84 per cent of the total transaction allocation.

Shutterstock/Andrew V Marcus

by Kudakwashe Muzoriwa

Saudi-based Fawaz Alhokair Group’s Arabian Centres, the owner, developer and operator of shopping centres has issued $500 million five-year Sukuk as part of the company’s $1.9 billion refinancing package comprising of Islamic bonds and new bank debt.

Arabian Centres also signed new Ijarah and Murabahah term facilities, which together with the Sukuk proceeds, will be used to refinance the company’s existing bank facilities, extending the debt maturity profile as well as increase flexibility to invest in the business and reducing secured debt as a proportion of overall borrowing.

The transaction includes a senior unsecured Shari'ah compliant Sukuk offering of SAR 1.9 billion ($500 million) and senior secured Ijarah and Murabahah duel currency term facilities of SAR 4.5 billion ($ 1.2 billion) as well as a senior secured dual currency revolving Murabahah facility of SAR 0.75 billion ($200 million).

Olivier Nougarou, the CEO at Arabian Centres, said, “Having executed a successful initial public offering of our stock and familiarised the broader market with our unique value proposition, we are very pleased to further diversify our funding mix by tapping into the debt capital markets.”

In April 2019, Arabian Centres raised as much as SAR 2.8 billion ($747 million) after pricing its initial public offering (IPO) at the bottom of its indicative range.

The Arabian Centres operates 19 shopping centres across the Kingdom, with four malls due to open this year and five projects in the pipeline.


RELATED STORIES: Fawaz Alhokair Group Arabian Centres Sukuk Ijarah Murabahah




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