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Tabreed raises USD 500 million with new 7-year 2.5% bond

Wednesday, October 21, 2020

21 October, 2020 – Abu Dhabi, United Arab Emirates: National Central Cooling Company PJSC (DFM: Tabreed), the leading  District Cooling developer headquartered in the UAE, today announced that it has successfully raised USD500 million (AED 1.8 billion) with a 7-year, 2.5% coupon bond issuance.

With orders coming from around 140 high quality local and international investors, the issuance was oversubscribed almost 5 times at its initial size of USD 400 million, demonstrating strong investor confidence in Tabreed’s solid credit fundamentals, despite current global economic uncertainty. This significant demand allowed Tabreed to tighten pricing significantly to achieve a final coupon of 2.5% and to increase the size of the final bond to USD 500 million.  The bond is rated Baa3 by Moody’s and BBB by Fitch, in line with Tabreed’s corporate ratings.

The 7-year bond was particularly well received by international investors, who accounted for 90% of the final geographical allocation, with 49% from Europe, 21% from Asia and 20% from offshore US funds.  The bond will be listed on the London Stock Exchange, alongside Tabreed’s existing 2025 Sukuk.

Commenting on the issuance, Khaled Abdulla Al Qubaisi, Tabreed Chairman said: “The success of the issuance is proof of the continued confidence in Tabreed and its ability to generate sustainable cash flows and returns.   Our solid fundamentals and strong credit ratings have translated into unprecedented market appetite, and I am proud to say that this has enabled us to attract significantly oversubscribed demand from a diverse pool of investors. This is also a vote of confidence from investors in Tabreed’s future and the growth potential of the organization.”

Bader Saeed Al Lamki, Tabreed Chief Executive Officer, said: “The  bond issuance, which was extremely well received by the market, is part of a long-term strategy and it enables us to further expand our operations with a focus on scalable growth. The global interest in Tabreed is a testament of its strong financial position, sound business model and leading position in the District Cooling industry.

JP Morgan and HSBC acted as Joint Global Coordinators and Bookrunners for the issuance, with Commercial Bank of Dubai acting as a Joint Lead Manager.

For over 22 years, Tabreed has been the partner of choice for organizations seeking environmentally friendly cooling solutions to support their sustainability goals and to reduce their overall energy consumption and carbon footprint. With 83 District Cooling plants, Tabreed currently delivers over 1.342 million refrigeration tons to key projects, including iconic developments such as the Burj Khalifa, Dubai Opera, The Dubai Mall, Sheikh Zayed Grand Mosque, Al Maryah Island, Yas Island and Ferrari World Abu Dhabi, Dubai Metro, the Bahrain Financial Harbour and the Jabal Omar Development in the Holy City of Mecca in the Kingdom of Saudi Arabia.

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