Bahrain's Mumtalakat plans 5yr, $500m bond

Bond sale could launch within a few days to take advantage of a global rally.
Bahrain's Mumtalakat plans 5yr, $500m bond
BOND SALE: Mumtalakat, Bahrains sovereign wealth fund, plans to raise at least $500m from a sale of bonds maturing in a minimum of five years. (Getty Images)
By Reuters
Mon 21 Jun 2010 10:24 PM

Bahrain's sovereign wealth fund Mumtalakat plans to raise at least $500 million from a sale of bonds maturing in a minimum of five years, banking sources said on Monday.

The bond sale could be launched in the next few days to take advantage of a global rally and a boost from China's vow to allow a more flexible yuan exchange rate.

Beijing's move has boosted global stocks and led to a fall in US debt prices.

A banking source familiar with the matter said: "They could raise between $500 million to $1 billion depending on market conditions."

He added: "The market has been looking good in the last few days."

Two other sources who attended the investor meetings said Mumtalakat was eyeing at least a benchmark sized bond with a tenor of five years. Benchmark sized is usually taken to mean $500 million.

Ratings agencies Fitch and Standard & Poor's have assigned 'A' ratings to the expected issue. Proceeds from the bond sale are expected to pay down some debt and for general corporate purposes.

Mumtalakat Holding, which bundles Bahrain's non oil state owned companies, said its full year net loss in 2009 more than doubled due to higher losses at its portfolio companies Gulf Air and Aluminium Bahrain.

Mumtalakat's investor meetings come on the heels of a roadshow by the emirate of Dubai. Fund managers who attended the meetings said Dubai could issue a dollar denominated Islamic bond as early as the third quarter. (Reuters)

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