Middle East Loans

Emerging market borrowers are turning their noses up at the terms on offer in the loan market, which have become dearer during the coronavirus pandemic. Lenders say they are willing and ready to lend, but are not ready to concede on their terms, writes Mariam Meskin.

Saudi Aramco has closed a $10bn loan, according to bankers near the deal. The loan — the largest signed in the Middle East so far this year — comes amid a drop in oil prices, which has sent borrowers in the Gulf hunting for financing.

Saudi Aramco, the world’s largest oil company, is hunting for a $10bn loan, according to market sources. Plummeting oil prices will send borrowers across the Gulf scrambling to raise financing. But creditors seem happy to plough money into the region, for now. Mariam Meskin reports.

The number of year-to-date loans signed across CEEMEA more than halved compared to last year, which bankers said is a direct result of the coronavirus crisis that has engulfed countries and markets worldwide. The outlook for issuance is bleak, to the dismay of many lenders.

London-listed UAE payments company Network International has refinanced an existing loan, raising $525m from regional and international lenders.

The spread of Covid-19 in the Middle East and the simultaneous drop in oil prices has prompted governments across the region to increase borrowing from capital markets. But some credits will have a far easier ride than others, bankers and experts said.

Oman’s Bank Muscat, which is part-owned by the Sultanate of Oman, raised a $650m loan from international lenders. The loan was announced amid Moody's downgrading the bank and the Omani sovereign, the latest in a string of rating actions that have pushed the challenged Gulf nation into junk territory.

As the deadly Covid-19 virus continues to wreak havoc on global markets and supply chains, emerging market lenders are proceeding to discuss financing options with clients, but are only comfortable funding those of the highest quality, according to bankers. Origination processes are becoming more stringent than ever, with some lenders requesting to see borrowers detailed contingency plans.

Saudi Arabian fashion retailer Fawaz Abdulaziz Alhokair has raised an $800m multi-currency loan with a consortium of local lenders.

Omani gas transportation company, Oman Gas Co, a branch of state-owned Oman Oil Co, has sold an $800m credit facility to local lenders.

Drinks group C&C to sell US PPs as Irish firms return — Almarai feasts on $100m for MENA expansion — Lufthansa flies by Schuldschein market for short dated debt — Archer plots loan A&E — Greencoat UK draws debt for wind farm buy

Saudi Arabian food and beverage producer Almarai has secured a $100m loan from the European Bank for Reconstruction and Development (EBRD) to support expansion in Egypt and Jordan.