PIF-backed Saudi Electricity plans sale of dollar sukuk

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Saudi Electricity Company is planning to issue a green or conventional sukuk (Islamic bonds) denominated in US dollars.

The banks will hold meetings with fixed-income investors starting Friday (March 31), the company said in a statement to the Saudi bourse.

The issuance amount will be determined later based on market conditions and requirements.

The company has hired HSBC, Standard Chartered, JPMorgan Securities, First Abu Dhabi Bank, MUFG Securities, Mizuho, SMBC Nikko, SNB Capital, Al Rajhi Capital, Saudi Fransi Capital, Abu Dhabi Islamic Bank, Bank of China, Abu Dhabi Commercial Bank, Natixis, and Societe Generale as joint lead managers.

The proceeds will be used for general corporate purposes, including capital expenditure, or if issued as green sukuk to fund eligible projects under the company’s green sukuk framework.

Saudi Electricity, which is 74.3 percent owned by the Saudi sovereign wealth fund, the Public Investment Fund (PIF), first raised $1.3 billion by selling a two-tranche green sukuk in 2020.

Last month, the utility provider raised SAR10 billion ($2.66 billion) via a syndicated loan from nine local banks.

The company raised $3 billion from another syndicated loan from 15 regional and international banks in August 2022.

On Wednesday, Saudi Arabia’s Al Rajhi Bank raised $1 billion with five-year sustainable Islamic bonds.

In February, PIF raised $5.5 billion through its latest green bond issuance, supporting expectations of a strong year for sustainable bonds in the Middle East.