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Tabreed raises USD 500 million with new 7-year 2.5% bond

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Tabreed raises USD 500 million with new 7-year 2.5% bond

A testimony of strong investor confidence in Tabreed
20th October, 2020 – Abu Dhabi, United Arab Emirates: National Central Cooling Company PJSC (DFM: Tabreed), the leading District Cooling developer headquartered in the UAE and 40% owned by ENGIE, today announced that it has successfully raised USD500 million (AED 1.8 billion) with a 7year, 2.5% coupon bond issuance.

With orders coming from around 140 high quality local and international investors, the issuance was oversubscribed almost 5 times at its initial size of USD 400 million, demonstrating strong investor confidence in Tabreed’s solid credit fundamentals, despite current global economic uncertainty. This significant demand allowed Tabreed to tighten pricing significantly to achieve a final coupon of 2.5% and to increase the size of the final bond to USD 500 million. The bond is rated Baa3 by Moody’s and BBB by Fitch, in line with Tabreed’s corporate ratings.

A well-received operation

The 7-year bond was particularly well received by international investors, who accounted for 90% of the final geographical allocation, with 49% from Europe, 21% from Asia and 20% from offshore US funds. The bond will be listed on the London Stock Exchange, alongside Tabreed’s existing 2025 Sukuk.

Commenting on the issuance, Khaled Abdulla Al Qubaisi, Tabreed Chairman said: “The success of the issuance is proof of the continued confidence in Tabreed and its ability to generate sustainable cash flows and returns. Our solid fundamentals and strong credit ratings have translated into unprecedented market appetite, and I am proud to say that this has enabled us to attract significantly oversubscribed demand from a diverse pool of investors.”

Bader Saeed Al Lamki, Tabreed Chief Executive Officer, said: “The bond issuance, which was extremely well received by the market, is part of a long-term strategy and it enables us to further expand our operations with a focus on scalable growth. The global interest in Tabreed is a testament of its strong financial position, sound business model and leader position in the District Cooling industry.”

Sébastien Arbola, Chief Executive Officer of ENGIE Middle East, South & Central Asia and Turkey commented: “This bond issuance is a demonstration of the solidity of Tabreed’s financial model in the eyes of international investors and is another testimony of the company’s ability to grow while being an enabler of the energy transition. Indeed, this operation consolidates Tabreed’s position as a leader in the provision of massively and efficiently low-carbon solutions to its customers.”

JP Morgan and HSBC acted as Joint Global Coordinators and Bookrunners for the issuance, with Commercial Bank of Dubai acting as a Joint Lead Manager.

Sébastien Arbola, Chief Executive Officer of ENGIE Middle East, South & Central Asia and Turkey commented: “This bond issuance is a demonstration of the solidity of Tabreed’s financial model in the eyes of international investors and is another testimony of the company’s ability to grow while being an enabler of the energy transition. Indeed, this operation consolidates Tabreed’s position as a leader in the provision of massively and efficiently low-carbon solutions to its customers.”

JP Morgan and HSBC acted as Joint Global Coordinators and Bookrunners for the issuance, with Commercial Bank of Dubai acting as a Joint Lead Manager.

Present for more than 30 years in the GCC countries, ENGIE, has been delivering to millions of people reliable power, potable water and efficient cooling through Tabreed since 2017. With 83 District Cooling plants, Tabreed currently delivers over 1.342 million refrigeration tons to key projects, including iconic developments such as the Burj Khalifa, Dubai Opera, The Dubai Mall, Sheikh Zayed Grand Mosque, Al Maryah Island, Yas Island and Ferrari World Abu Dhabi, Dubai Metro, the Bahrain Financial Harbour and the Jabal Omar Development in the Holy City of Mecca in the Kingdom of Saudi Arabia.

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