23/09/2024
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23/09/2024
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KUWAIT CITY, Sept 23: Warba Bank announced the EQUATE Petrochemical Company K.S.C.C.’s USD 750 million sukuk offering, which found both regional and global success. Warba Bank acted as Joint Lead Manager, Joint Bookrunner and Kuwait Marketing Agent. The transaction was led by Citigroup, First Abu Dhabi Bank, J.P. Morgan, Mizuho and MUFG as Global Coordinators. KFH Capital and SMBC Nikko Capital Markets limited as Joint Lead Managers and Bookrunners, in addition to Co-Managers including Bank ABC, DBS Bank Ltd., IMI-Intesa Sanpaolo, and Standard Chartered Bank. Books opened on Tuesday, August 29th 2024, and closed on the same day, received great interest from regional and international market participants, as the order book reached USD 2 billion, 2.6x the issuance size.
Warba Bank said in a press statement that this issuance is under the EQUATE Sukuk Programme denominated in US dollars, valued at USD 2 billion. The 7 year USD 750 million Sukuk was successfully issued with a fixed profit rate of 5.00%. The issuance was priced at a discount, with a reoffer price of 98.995% to yield 5.173%.The Sukuk were listed on the Global Exchange Market of Euronext Dublin.
The strong demand for the Sukuk was evident through its diverse allocation, which saw significant participation from a wide range of institutional investors across the globe:
-tBanks and Private Banks received the largest share of the issuance, representing 56% of the total allocation, a clear indication of the banking sector's confidence in EQUATE’s credit profile.
-tFund Managers accounted for 37% of the total allocation, highlighting the interest in high-quality, Sharia-compliant assets.
-tCorporates, Central Banks/Official Institutions, Insurance, and Pension Funds collectively represented the remaining 7%, showing strategic interest in the Sukuk for balance sheet management and diversification purposes.
Geographically, the MENA region was the largest contributor, receiving 68% of the total allocation, followed by investors from the UK, Europe, Asia, and Offshore US.
In this context, Thuwaini Khaled Al-Thuwaini, Chief Investment Banking Officer at Warba Bank, said, “With the confidence of the market in hand, we succeeded in closing the sukuk issuance amid excellent market participation and reaction, which is a testament to Warba Bank’s strategic foresight and collaboration. It is a victory that reflects not only the strength of the offering but also the pulse of the market’s confidence and enthusiasm.”
Al-Thuwaini pointed out the importance of Islamic financing tools and their role in strengthening global financial markets, which is evidenced by the level of demand and interest of global investors in recent sukuk issued by regional corporates and banking institutions. He underscored Warba Bank’s path to remain a significant player in the debt capital markets for years to come by continuing to focus on growth and expansion as Warba Bank aims to extend its reach and services to both institutional and individual investors through its commitment to ethical banking and innovative strategies.
