Abu Dhabi has announced that it has successfully completed a $2 billion bond issuance with a seven-year tenor – the first of its kind for the sovereign issuer.
The bonds were well received by fixed income investors, including US investment grade corporates and portfolios, effectively expanding the investor base, the emirate’s media office said in a statement.
It added that the issuance recorded the tightest yield ever by an emerging market sovereign and the lowest credit spread of all Abu Dhabi issuances across all tenors.
The statement also said that the peak order book reached $6.9 billion, representing a 3.5 times oversubscription.
In September, Abu Dhabi announced it completed a $5 billion multi-tranche bond offering to allow the emirate to focus on sustaining non-hydrocarbon sector expansion.
Separately, Abu Dhabi Securities Exchange (ADX) announced on Thursday that it has listed $1 billion of bonds issued by Abu Dhabi Ports.
The 10-year bonds, with a primary listing on the London Stock Exchange, were 4.5 times over-subscribed.
Bond market development is a key part of the Abu Dhabi exchange’s ADX One strategy, which aims to increase liquidity and broaden the market’s offering of products and services.
In the last year the ADX has attracted exchange traded funds (ETFs) and listings on the Second Market, and the launch of a derivatives market is scheduled for late 2021.
The listing of Abu Dhabi Ports bonds follows the listing on ADX in April of 1.1 billion euros of bonds issued by Mamoura Diversified Global Holding, a debt issuing entity of Mubadala Investment Company.
Saeed Hamad Obaid Al Dhaheri, CEO of ADX, said: “We welcome the listing of Abu Dhabi Ports’ bonds on the ADX as the exchange continues to deepen the marketplace, providing investors with high quality access to regional investment opportunities. This year, we have seen a significant increase in liquidity and an acceleration in the growth in market capitalisation, which has made the ADX the second largest market in the MENA region.”
Trading on ADX has increased this year as the exchange’s market capitalisation increased 27 percent during the first quarter to a record AED940 billion.
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