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Wed 3 Dec 2014 07:49 PM

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Saudi's Marafiq signs $666m Islamic loan

Utility services provider to two industrial cities in Saudi Arabia says funds will be used to expand capacities

Saudi's Marafiq signs $666m Islamic loan

Marafiq, a utility services provider to two industrial cities in Saudi Arabia, has signed a 2.5 billion riyal ($666.1 million) Islamic loan, which will partly be used to expand capacities in its existing projects.

The new long-term facility was arranged by HSBC's Saudi Arabian arm, it said in a statement, without revealing the tenor and pricing of the transaction.

The company, which counts Saudi Basic Industries Corp and Saudi Aramco as shareholders, will use the murabaha-structured facility for capacity expansion plans in different projects located in Jubail and Yanbu.

A murabaha is a cost-plus-profit arrangement which is one of the most popular formats for structuring Islamic loans.

Al Rajhi Bank, National Commercial Bank, Riyad Bank, Samba Financial Group and Saudi British Bank joined the facility, the statement said.

Marafiq's last fundraising was its debut 2.5 billion riyal sukuk in 2013, and its previous syndicated murabaha facility transaction was for 4.5 billion riyal, which completed in 2012.

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