Saudi Telecom Company (STC), a leading digital enabler in the region, announced today, Sunday, the successful completion of its issuance of US dollar-denominated international sukuk totaling $2 billion (approximately SAR 7.5 billion). This issuance, part of the company's international sukuk program, reflects its strong financial position and the confidence of international investors in its future performance.
According to the official statement issued by the company on the Saudi Stock Exchange (Tadawul) website, the offering was divided into two main tranches to meet the preferences of different investors. The first tranche was valued at US$750 million and consisted of 3,750 sukuk with a nominal value of US$200,000 each, a maturity of up to 5 years, and an annual yield of 4.48%. The second tranche was valued at US$1.25 billion and consisted of 6,250 sukuk with the same nominal value but a longer maturity of up to 10 years and an annual yield of 5%.
Strengthening the financial strategy and expanding investment
This strategic move by STC comes at a time when Saudi Arabia is experiencing significant economic growth under Vision 2030. This issuance aims to diversify the company's funding sources, giving it greater flexibility in managing liquidity and financing its ambitious expansion plans. The company is diligently working on its "Dare" strategy, which focuses on expanding its digital services, cloud computing, and Internet of Things (IoT) offerings, as well as strengthening its 5G network infrastructure, which is the backbone of the modern digital economy.
International confidence in the Saudi economy
The success of this offering and the listing of the sukuk on the London Stock Exchange's International Financial Market is strong evidence of the attractiveness of major Saudi companies to foreign investors. The demand for Saudi debt instruments reflects the confidence of global financial institutions in the strength of the Saudi economy and its robust credit rating, as well as the financial soundness of STC, one of the largest telecommunications companies in the Middle East and North Africa.
Regulatory details of the offering
The company clarified in its statement that the sukuk may be redeemed before their maturity date in certain circumstances, which are detailed in the original prospectus. It also noted that the sale may be conducted in accordance with Regulation S and Rule 144A of the U.S. Securities Act of 1933, as amended, thus opening the door for a broad base of qualified global investors to participate in this unique issuance.
In conclusion, this issuance represents an important step that enhances the presence of Saudi companies in global debt markets, and confirms the ability of the Saudi private sector to attract foreign capital to support the wheel of sustainable development in the Kingdom.
