Saudi multinational chemical manufacturing company, Saudi Basic Industries Corporation (SABIC) is raising $1 billion this year in the largest corporate dollar bond offer from the Middle East.
Reports suggest that the firm in which Saudi Arabian state oil company ARAMCO has a majority stake in “is offering $500 million of 10-year notes over mid-swaps at an initial price talk of 190 basis points” along with another $500 million of 30-year securities at an initial yield of 3.375 percent.
Saudi Arabia aims to promote its economic development away from petroleum by building new industries, and that strategy involves expanding chemical output to sell higher-value hydrocarbon products.
Earlier this year, the world’s largest oil exporter Saudi Aramco purchased a 70% stake in SABIC for $69 billion.
Moody’s Investors Service is rating SABIC bonds at A1 with a negative outlook, the fifth-highest investment grade.
At A-, S&P Global Ratings allocates the debt two levels lower. The deal is arranged by Citigroup, BNP Paribas, HSBC Holdings, Mizuho Securities Corporation, MUFG and SMBC Nikko Securities Incorporation.
SABIC lost $592 million (SAR 2.22 billion) in the second quarter because of the coronavirus pandemic situation affected the worldwide economies. A year earlier the company reported a profit of SAR 2.03bn (approx. $541m).