Saudi Aramco has started issuing U.S. dollar-denominated international bonds today under its Global Medium Term Note Program. Saudi Arabia’s Tadawul revealed that the bonds have a minimum subscription of $200,000, stating that the issuance amount is subject to market conditions. Aramco’s bond issuance began today, July 9, and will end on July 17.
In its Tadawul listing, Saudi Aramco also revealed that the U.S. dollar-denominated bonds are direct, general, unconditional and unsecured obligations of the company. The target class of the issuance is institutional investors. Saudi Aramco also revealed that the bonds’ return and maturity will be subject to market conditions.
Listing’s book runners
The oil giant also stated that Citi, Goldman Sachs International, HSBC, J.P. Morgan, Morgan Stanley and SNB Capital will be active joint bookrunners. In addition, Abu Dhabi Commercial Bank, anb capital, Bank of China, BofA Securities, BSF Capital, Emirates NBD Capital Limited, First Abu Dhabi Bank, GIB Capital, Mizuho, MUFG, NATIXIS, Riyad Capital, SMBC Nikko, and Standard Chartered Bank are the issuance’s passive joint bookrunners.
Bonds’ redemption options
Saudi Aramco also revealed different redemption options for the U.S. dollar-denominated bonds including redemption on maturity; redemption following an event of default; redemption for tax reasons (at the option of Saudi Aramco); issuer call (at the option of Saudi Aramco); issuer maturity par call (at the option of Saudi Aramco); make whole call (at the option of Saudi Aramco); investor put (at the option of noteholders); and change of control put (at the option of noteholders), each subject to market conditions.
Saudi Aramco will issue the U.S. dollar-denominated bonds in accordance with the Rule 144A/Reg S offering requirements under the U.S. Securities Act of 1933. Moreover, it revealed that the stabilization rules of the Financial Conduct Authority (FCA) and the International Capital Market Association (ICMA) will also apply to the issuance.
The company will apply for the bonds to be admitted to the official list of the FCA and to the London Stock Exchange plc and for such bonds to be admitted to trading on the London Stock Exchange’s main market.
Read: ADQ’s $2.5 billion bond undergoes secondary listing on Abu Dhabi stock market
Aramco returns to the debt market
With this issuance, Saudi Aramco returns to the debt market after three years. In its last issuance in 2021, the company raised $6 billion from a three-tranche sukuk. In February, it also revealed plans to issue another bond this year.
The U.S. dollar-denominated bond issuance comes after Saudi Aramco sold over $10 billion worth of shares last month, marking the company’s second public offering. Last month, the company sold 0.64 percent or 1.55 billion shares for $7 to $7.70 per share.
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