Al-KHOBAR – Olayan Group has concluded its maiden issue of an Islamic bond (sukuk), two sources with knowledge of the matter said Tuesday. It is one of a number of Saudi entities that have priced their first local currency sukuk this year as interest in the country's debt market grows on the back of high investor liquidity and a desire to diversify funding sources away from bank loans. The firm, which has interests in manufacturing and services and has a multi-billion dollar portfolio of investments spread across major asset classes globally, priced the SR650 million ($173.3 million), five-year sukuk at 150 basis points over the Saudi interbank offered rate (SAIBOR), one of the sources said. The privately-place transaction was around 2.5-times subscribed and was sold to investors including banks, private funds and insurance companies, the source added. HSBC Saudi Arabia and Riyad Capital arranged the sukuk. Baker & McKenzie was legal advisor to the firm on the deal. – Agencies
