Saudi 30-yr bond price guidance at 235 bps over treasuries

Saudi officials have flown to the UK and US last week to lay the groundwork for the three-tranche debut Eurobond forecast to break records and pave the way for a pipeline of deals. (File: AFP))

Saudi Arabia gave price guidance for its planned three-tranche debut Eurobond on Tuesday.

Pricing guidance for the five-year tranche was in the 160 basis points over US treasuries area; guidance for the ten-year tranche was in the 185bps over treasuries area and it was in the 235bps over treasuries area for the planned 30-year bond tranche.

Basis point (BPS) refer to a common unit of measure for interest rates and other percentages in finance. One basis point is equal to 1/100th of 1 percent, and is used to denote the percentage change in a financial instrument.

The transaction is expected to price on Wednesday.

Citi, HSBC and JP Morgan are the global coordinators of the senior unsecured 144A / Reg S bond.

Saudi Arabia is expected to raise between $10 billion and $20 billion through its inaugural transaction, though some investors think the sovereign will be more conservative around size than pricing.

Officials had flown to the UK and US last week, according to Financial Times, to lay the groundwork for the issue forecast to break records and pave the way for a pipeline of deals, including the world’s biggest initial public offering from state oil company Aramco.

A banker away from the deal in London agreed that the initial pricing levels contained few surprises. “f you’e selling for size, you need to hook people in and build a book,” he said.
 

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Last Update: 06:48 KSA 09:48 - GMT 06:48
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