Saudi Aramco said to borrow up to SAR 6 bln in local sukuk

Saudi Arabian Oil Co. (Saudi Aramco), the world’s largest crude exporter, is planning to issue between SAR 3 and 6 billion worth of domestic sukuk, Reuters has reported, citing unnamed sources.

The sukuk is expected to be issued over the next two to three months, said the sources.

The bond proceeds will be used to finance new expansion projects, including a huge ship repair and shipbuilding complex at Ras al-Khair.

The Saudi company is expected to offer US dollar-denominated sukuk to international investors later. Aramco declined to comment on the Reuters report.

Alinma Investment, HSBC Saudi Arabia, NCB Capital and Riyad Capital have been appointed lead managers for the planned sukuk issue, Bloomberg reported on Tuesday.

Saudi Aramco plans to sell up to 5 percent of its shares in next year in what would be the world’s biggest initial public offer. The international sukuk issue is unlikely to happen before the IPO, according to earlier news reports.