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Sun 6 Oct 2019 09:04 AM

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Abu Dhabi issues $10bn multi-tranche bonds

The final geographical allocation for the bonds stood at 78% from international investors and 22% from the Middle East

Abu Dhabi issues $10bn multi-tranche bonds
The bonds were well received in international debt capital markets, with the order book peaking at $25 billion with orders coming from over 650 unique accounts.

Abu Dhabi successfully priced a $10 billion multi-trance international bond offering in late September, according to the UAE’s state-run WAM news agency.

According to WAM, the transactions comprised three tranches: $3 billion, 2.125 percent, due in 2024, which was priced at 65 basis points over US Treasuries, $3 billion, 2.5 percent, due in 2029 and priced at 85 basis points over US treasuries, and $4 billion, 3.125 percent, due in 2049, which is priced at 110 bps points over US Treasuries.

The bonds were well received in international debt capital markets, with the order book peaking at $25 billion with orders coming from over 650 unique accounts.

“The success of the issuance is a testament of investor confidence in the government of Abu Dhabi’s economic and political stability and the strong credit story,” said Jassem Mohammed Bu Ataba AlZaabi, the chairman of the department of finance, Abu Dhabi. “We are pleased to witness the achievement of the lowest ever coupons by the government of emirate of Abu Dhabi since the debut issuance in 2007.”

Alzaabi added that Abu Dhabi managed to achieve “the tightest 5-, 10-, and 30-year coupon for a GCC conventional bond. This reflects on the investors’ high confidence in the Emirate’s wise leadership, continuous focused growth strategy as well as its high buffers."

The final geographical allocation for the bonds stood at 78 percent from international investors and 22 percent from the Middle East.

BNP Paribas, Citigroup, First Abu Dhabi Bank, HSBC, J.P. Morgan and MUFG were Joint Lead Managers and Joint Bookrunners, and Abu Dhabi Commercial Bank P.J.S.C. and SMBC Nikko were co-lead managers for the offering.