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DEBT WATCH-
Al Rajhi Bank has launched USD 1 bn in additional tier 1 sustainable sukuk, Reuters reported on Thursday, citing a document it has seen from one of the arranging banks. It tightened the final yield to 6.375% from an initial guidance of 6.875%. The debt transaction saw heavy demand from local and foreign investors with some USD 3.5 bn in orders. The sukuk are perpetual which in industry-speak means they have no fixed maturity rate, the lender said in a disclosure to Tadawul earlier in the day. The bonds can first be redeemed after five years, according to the bank.
AT1 bonds? The debt instruments act as a capital cushion for banks if their capital levels fall below a certain threshold. They are seen as the riskiest debt instruments that can be issued by lenders and therefore hold a higher coupon.
Advisors: Al Rajhi Bank hired our friends at HSBC, along with Al Rajhi Capital, Citigroup Global Markets, Dubai Islamic Bank PJSC, Emirates NBD Bank, Goldman Sachs International and Standard Chartered Bank as joint lead managers and bookrunners.
REMEMBER- The leading Islamic lender tapped the debt market for the first time this year in March after it closed USD 1 bn from its USD-denominated sustainable sukuk offering. The sukuk sale saw orders topping USD 2.8 bn.
REAL ESTATE-
#1- Egyptian real estate giant Talaat Moustafa Group (TMG) broke ground on their first project in Saudi, Aleqtisadiah reported yesterday, citing a statement from TMG. The integrated Benan city is being developed in eastern Riyadh’s Al Fursan in partnership with the National Housing Company. It will be home to some 27.8k residential units, along with a sports club and health, educational, and commercial services. The project marks the Egyptian real estate developer’s first overseas project. The project would carry a price tag of about SAR 65 bn (c. USD 17.3 bn) — 63% above an initial price estimate of SAR 40 bn (c. USD 10.7 bn) when the project was first announced in September in a TMG statement. It expects some SAR 40 bn in revenues from the project, media reports suggest.
You can expect calls from brokers soon: Interested buyers can start purchasing their units starting Wednesday, 15 May, according to TMG-Saudi website.
#2- Sumou Real Estate Co. signed a development management agreement with Inma Gate Al Gharbia Investment and Real Estate Development Co. to develop a project for Alinma Al Taif Real Estate fund, it said in a disclosure to Tadawul. Under the 24-months contract, Sumou will receive a development management fee of SAR 21.5 mn for the project, which spans an area of 2.1 mn sqm.
FOOD SECURITY-
Saudi, Ghana agree to boost agricultural ties: Environment, Water and Agriculture Minister Abdulrahman Alfadley agreed with Ghanian counterpart Bryan Acheampong to increase investments between the two countries in agriculture, livestock and others, state news agency SPA reported. They agreed on facilitating investments and expanding the scope of economic partnership between Saudi and Ghana. The meeting came as part of an African tour by Alfadley which included Ghana, Nigeria, Ivory Coast and Senegal.
