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Allen & Overy advises on landmark USD2 billion sukuk

 

​​Allen & Overy, in association with leading local law firm Zeyad S. Khoshaim, has advised Saudi Electricity Company (SEC), the Gulf's largest utility company, on its first sukuk offered to US and other international investors in accordance with Rule 144A under the US Securities Act of 1933.

The deal, worth USD2 billion, is the largest Rule 144A sukuk out of the Middle East to date and consists of a 10 year series and an unprecedented 30 year series.

The 30 year series is the longest tenor for any senior unsecured sukuk issue to date. Deutsche Bank and HSBC were the joint lead managers.

The Allen & Overy team was led by London-based partners Atif Hanif, Sachin Davé and Jamie Durham, assisted by associates Cieren Leigh, Tracy Tong and Christopher Clark. Partner Stephen Fiamma and senior associate Stefka Kavaldjieva advised on US tax matters and London-based partner Roger Wedderburn-Day advised on disclosure. The Riyadh-based team comprised partner Zeyad Khoshaim, senior associate Jonathan Marshall and associate Yazeed Alsalman.

Commenting on the deal, partner and head of Allen & Overy's European Islamic finance practice Atif Hanif said: "We are very pleased to have advised SEC on such a landmark transaction. The sukuk issue was very well received in the international markets and was oversubscribed by more than 6.5 times. It also achieved many firsts, including the first dual series sukuk issued under Rule 144A out of the Middle East and the first 30 year senior unsecured sukuk."

Partner Zeyad Khoshaim added: "This transaction illustrates the faith that international investors have in the long-term prospects of the Saudi economy. It is likely to pave the way for other issuers from Saudi Arabia and the other Gulf countries to tap the international markets for longer tenor instruments."

This is the latest successful closure in an outstanding twelve months for Allen & Overy's Islamic Finance Group. Notable transactions include advising on SEC's first international sukuk (worth USD1.75bn), advising the dealers on the establishment of USD2bn sukuk programme and issuance of USD750 million sukuk due 2017 by Banque Saudi Fransi and advising the financiers on the USD2.85bn Qurayyah IPP project entailing the development of a large gas-fired power plant in Saudi Arabia.

For further information, please contact Margherita Orlandini, on +44 (0)20 3088 4196.

 

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