Demand high for Abu Dhabi’s bonds

$5b bonds of varying maturities were oversubscribed 4.8x

There has been strong investor backing for Abu Dhabi’s $5 billion in dollar-denominated bonds with three maturity periods.

These included a $1.75 billion tranche maturing in 5 years with a coupon rate of 4.875 per cent; a $1.5 billion tranche maturing in 10 years with a coupon rate of 5 per cent; and a $1.75 billion tranche maturing in 30 years with coupon at 5.5 per cent.

“The rates represent a 35-basis point spread over 5-year US Treasuries, a 45-basis point spread over 10-year Treasuries,

The investor appetite and the lowest spreads ever achieved by an issuer in the CEEMEA region stand testament to global investor confidence in Abu Dhabi’s financial stability as well as its positive long-term economic outlook.”

Jassem Mohammad Bu Ataba Al Zaabi | Chairman of the Department of Finance, Abu Dhabi and a 90-basis point spread over 30-year Treasuries,” said a statement.

The issuance was 4.8 times oversubscribed and the ‘pricing landed meaningfully inside fair value’.

“The spread achieved by Abu Dhabi represents the tightest spread ever achieved by the emirate and the tightest spread ever achieved by any issuer in the CEEMEA region for 5-, 10-, and 30-year issuances,” the statement added.

AA rating

The rating agencies S&P’s and Fitch had assigned ‘AA’ to the bonds.

“The investor appetite and the lowest spreads ever achieved by an issuer in the CEEMEA region, stand testament to global investor confidence in Abu Dhabi’s financial stability as well as its positive long-term economic outlook,” said Jassem Mohammad Bu Ataba Al Zaabi, chairman of the Department of Finance, Abu Dhabi.