Aramco raises $6 billion in sukuk – Al-Iqtisadi – Arab Economy


A document showed that the giant Saudi oil company, Aramco, raised another $6 billion to help it finance massive cash dividends as it returned to global debt markets with its first US dollar-denominated sukuk issuance..

A document issued by one of the banks arranging the operation seen by Reuters said the debt issuance, which will help finance the company’s commitment to dividends of $75 billion, mostly to the government, will consist of three, five and ten-year tranches..

Aramco sold $1 billion in bonds in the three-year bracket at 65 basis points over US Treasuries, $2 billion in the five-year bracket at 85 basis points over US Treasuries, and $3 billion in the 10-year bracket at 120 basis points over US Treasuries..

The initial indicative price was at about 105 basis points over the three-year US Treasuries, about 125 basis points over the five-year US Treasuries, and about 160 basis points above the US 10-year Treasury bonds..

The rate of return was reduced after the deal attracted more than $60 billion in orders. Last year, Aramco maintained its pledge to distribute cash dividends of $75 billion to shareholders despite the drop in oil prices, and is expected to bear the responsibility of pumping large local investments that are part of Saudi Arabia’s plans to develop its economy..



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