Abu Dhabi National Oil Company (ADNOC) has successfully raised $1.5 billion through the sale of its 10-year dollar-denominated sukuk, marking a major milestone as part of its newly established International Sukuk Program.
According to a document released on Monday, this issuance, executed by ADNOC Murban, the company’s primary debt capital markets entity, was priced at 60 basis points over U.S. Treasuries. The sukuk attracted robust demand, with orders exceeding $3.85 billion, indicating strong investor interest in ADNOC’s financial instruments.
The key details of the sukuk issuance include the appointment of Standard Chartered Bank as the sole global coordinator. Several prominent financial institutions served as active bookrunners, including Abu Dhabi Commercial Bank, Abu Dhabi Islamic Bank, Dubai Islamic Bank, Emirates NBD Capital, First Abu Dhabi Bank, Morgan Stanley, and MUFG. The proceeds from the sukuk sale will be utilized by ADNOC Group for general corporate purposes, which may encompass funding operational expenses, capital expenditures, or other strategic initiatives.
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Commitment to financial diversification
This sukuk transaction follows ADNOC Murban’s inaugural global medium-term note bond issuance in September 2024 and a green financing facility signed in June 2024, showcasing ADNOC’s commitment to diversifying its funding sources and enhancing its financial flexibility.
The sukuk market has been experiencing significant growth, with Islamic bonds witnessing a remarkable 44 percent annual surge in value, reaching $46.2 billion, which is an all-time record for annual issuance. Sukuk accounted for 39 percent of total bond proceeds raised in the region, although this is a slight decrease from 45 percent at the same time last year. This trend reflects the increasing acceptance and demand for sukuk as a viable financing option among investors, particularly in the context of sustainable and responsible investment practices.
