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ACWA Power raises nearly SAR 3bn via Sukuk issue

ACWA Power raises nearly SAR 3bn via Sukuk issue
ACWA Power was able to tighten pricing by 25 bps pa

Riyadh – Mubasher: ACWA Power has raised SAR 2.8 billion through a senior, unsecured, floating Sukuk rate issuance under the Shariah-compliant Mudaraba-Murabaha structure, according to a press release on Tuesday.

The Islamic financing notes hold a tenor of seven years, with the offering resulting in oversubscription of 1.8 times over the issue size.

Initial price guidance was at 100 to 125 basis points per annum (bps pa) with a six-month average of the Saudi Arabian Interbank Offered Rate (SAIBOR).

ACWA Power was able to tighten pricing by 25 bps pa through the oversubscription, while the final 100 bps pa + SAIBOR pricing was the lowest spread secured across the Saudi capital markets by a corporate or bank issuer since 2017.

“The issuance marks the company’s maiden entry into Saudi debt capital markets,” ACWA Power noted. This was ACWA Power’s first transaction since the Public Investment Fund (PIF) became a 50% shareholder in 2020.

HSBC Saudi Arabia and Samba Capital acted as joint lead managers and bookrunners for the Sukuk transaction, with HSBC Issuer Services also acting as Sukuk holders’ agent and payment administrator.

Earlier this year, ACWA Power signed with the Arab Petroleum Investments Corporation (APICORP) a five-year Shariah-compliant corporate facility worth $125 million to support ACWA's renewable projects in the main markets.