Saudi Aramco has raised $3 billion through the sale of sukuk in the international market, in the company’s first Islamic bond offering since 2021.
The offering included two tranches, one for five years and the other for 10 years, according to people familiar with the matter who asked not to be identified. The company received more than $22 billion in orders for the bonds (meaning the offering was covered more than seven times).
While this is the company's first dollar-denominated sukuk offering in more than three years, it is the second time it has sold dollar debt instruments in the past two months as the government and its related companies borrow to diversify the country's economy.
Yields on the sukuk were 35 basis points below the guidance for both tranches during the sale, the people said. The shorter-dated sukuk sold at 85 basis points over U.S. Treasury yields while the longer-dated sukuk was 100 basis points higher.
The company raised $6 billion in bonds in July, including a 40-year tranche. Aramco, through SA Global Sukuk Limited, appointed Al Rajhi Capital, Citigroup, Dubai Islamic Bank, First Abu Dhabi Bank, Goldman Sachs, HSBC, JPMorgan Chase & Co, KFH Capital and Standard Chartered, among other GCC-based or Islamic banks, as joint bookrunners for the offering.
Sukuk issuance has surged this year. Moody’s expects global sukuk volumes to reach $200 billion to $210 billion, above 2023 levels, driven by a range of factors, including deal flow from Saudi Arabia.
