ACWA Power raises SAR 2.8 bln from 7-year sukuk issuance

Logo of ACWA Power

ACWA Power successfully raised SAR 2.8 billion through a senior, unsecured floating sukuk rate with a seven-year tenor under the Sharia-compliant Mudaraba-Murabaha structure. 

The first-of-its-kind issuance of the company in the Saudi sukuk market received strong turnout from fund managers, government funds and local insurance firms, which accounted for 30% of the issuance size. 
 

The issue size was 1.8x oversubscribed. 

Initial price guidance was set at 100-125 basis points per annum (bps pa) + 6 month SAIBOR. The oversubscription enabled ACWA Power to tighten pricing by 25 bps pa. The final 100 bps pa + SAIBOR pricing is the lowest spread secured in the Saudi capital markets by a corporate or bank issuer since 2017. 

HSBC Saudi Arabia and Samba Capital acted as Joint Lead Managers and Bookrunners for the issuance, with HSBC Issuer Services also acting as Sukuk holders’ Agent and Payment Administrator. Norton Rose Fulbright (NRF)’s London and Riyadh offices acted as Issuer Counsel while the JLMs were advised by Allen & Overy and Khoshaim & Associates.  

The issuance was the utility’s first-of-its-kind deal since the Public Investment Fund (PIF) acquired 50% of the company’s shares last year.