Saudi Arabia’s Public Investment Fund (PIF) announced today that it has successfully completed the pricing of a $4 billion Reg S bond issuance. The fund said that proceeds from the issuance will go to general corporate purposes.
The international bond offering is part of PIF’s Euro Medium-Term Note Program. It was four times oversubscribed, with an order book of approximately $16 billion. The issuance comprises two tranches: $2.4 billion (SAR9 billion) for five years and $1.6 billion (SAR 6 billion) for 9.5 years.
PIF’s capital-raising strategy supports growth
The oversubscription of the bond offering reflects the effectiveness of PIF’s capital-raising strategy and affirms its key role in driving Saudi Arabia’s economic transformation. It also underpins PIF’s strong financial position, as well as its best-practice approach to debt financing.
“Continued strong demand from international institutional investors is a testament to PIF’s diversified investor base, robust medium-term capital raising strategy and strong credit profile. These factors allow uninterrupted access to the global capital markets and support PIF’s efforts in driving Saudi Arabia’s economic transformation,” stated Ahmed Alrobayan, head of public markets, global capital finance, at PIF.
Notably, PIF is rated Aa3 by Moody’s with a stable outlook and A+ by Fitch, also with a stable outlook. The fund has four main sources of funding: capital injections from the government, government asset transfers, retained earnings from investments and loans and debt instruments.
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Driving Saudi Arabia’s economic growth
In a bid to further contribute to Vision 2030, PIF and Elm, a leading digital solutions company, recently signed a share sale and purchase agreement for Elm to acquire Thiqah Business Services Company in a deal valued at $907 million. The transaction will further support a thriving local information and communication technologies (ICT) ecosystem and contribute to PIF’s strategy of using digital transformation to create the high-skill jobs of the future and further grow the Saudi economy.
The deal will enhance the growth of the ICT sector, drive innovation, and localize technologies and knowledge by strengthening Elm to lead the sector at the national level, maximizing the value chain by providing a wide range of ICT products, services and devices.
