MUSCAT: Oman Electricity Transmission Co (OETC) and chave announced the successful pricing and settlement of OETC’s inaugural US$1bn notes, with a tenor of ten years, in the international capital markets.
OETC intends to use the proceeds from the issuance to repay existing debt and finance capital expenditure for ongoing and future projects and for other general corporate purposes.
The issuance of the note marks the first ever investment grade international bond issuance by an Omani corporate entity and also the largest-ever international capital markets issuance out of Oman, a press release said.
“OETC was able to meet a large financing requirement at attractive funding levels. This accomplishment is a testimony to the company’s robust business model and the strong regulatory framework of the Omani electricity sector. We are very pleased with the strong response to this landmark transaction, particularly being the first ever Omani investment grade corporate issuer,” said Ali al Hadabi, chief executive officer of OETC.
Following a focussed marketing effort by both OETC and EHC, commencing on April 22, 2015, covering core financial centres in the United States and United Kingdom, the notes, offered and sold pursuant to Regulation S and Rule 144A, were priced on April 29, 2015 at a coupon rate of 3.958 per cent (+190bps spread to US Treasury). The notes saw strong demand from global investors, attracting orders exceeding US$2.7bn.
The offering attracted interest from a diverse group of international investors. Approximately 33 per cent of the notes were distributed to investors in the Middle East, 28 per cent to investors in the US, 24 per cent to investors in the UK, eight per cent to investors in Europe and seven per cent to investors in Asia. Approximately 62 per cent were distributed to fund managers, 30 per cent to banks and private banks, four per cent to agencies and four per cent to insurance companies and pension funds.
Hadabi added, “The funding strategy supports the company’s growth story, and the strong investor demand for the offering is a testament to investors’ confidence in the OETC credit story and its operating performance track record.”
The notes have been admitted to listing and trading on the regulated market of the Irish Stock Exchange.
Bank Muscat and JPMorgan Securities acted as joint lead managers. Dentons acted as counsel to OETC, and Dechert and Al Busaidy, Mansoor Jamal acted as counsel to the joint lead managers.
SOURCE: Muscat daily