Apicorp’s debut ‘dim sum’ bond issue raises $100m

Arab Petroleum Investments Corporation (Apicorp) raised 630 million Chinese renminbi ($100m) through its debut dim sum bond as the Saudi Arabian multilateral development bank continues to diversify its funding sources.

Apicorp, which is rated Aa3 by Moody’s Investors Service, sold the three-year fixed rate bond which matures in March 2021, and offers investors an annual coupon of 4.7 per cent.

The deal was priced earlier this month, Apicorp said in a statement yesterday.

This is the first dim sum bond issuance by a supranational issuer from the Middle East and Africa region and marks Apicorp’s entry into the fast-growing debt capital market segment. The transaction attracted strong interest from Asian investors, enabling Apicorp to meet its deal size and pricing targets, it said.

“Since Apicorp’s inaugural US dollar benchmark public sukuk issuance in 2015, we have seen strong demand for our credit from Asia,” Ahmed Attiga, Apicorp’s chief executive, said. “This issuance has enabled Apicorp to further diversify its investor base by targeting a niche pool of Asian liquidity. We remain committed to exploring other efficient and cost-effective financing solutions via the international capital markets.”

Standard Chartered was the lead manager and bookrunner on the transaction. The bond, listed on the Irish stock exchange, is also a strategic step forward for Apicorp in becoming a regular issuer in the global markets, and, positions its credit alongside its multilateral development bank peers, it said.

Apicorp was set up to help develop the Arab world’s oil and gas industries. The organisation is owned by the 10 member states of the Organisation of Arab Petroleum Exporting Countries. It makes equity investments and provides project loans, trade finance, advisory and research to the energy industry.

In February, the Macau branch of Bank of China priced the largest dim sum bond in two-and-a-half years, according to the Financial Times. The $634m deal was the largest since the devaluation of China’s currency in August 2015.