GCC

Saudi Arabia’s listing of its prized asset, oil producer Saudi Aramco, was supposed to lure international investors into the kingdom. On that score, the deal will be a failure as pricing was set so high that only locals were interested. Now it seems global funds will have little reason to buy the shares once they start trading. Sam Kerr reports.

A handful of rare visitors came to the marker this week to place debt in dollars and yen, and bankers scrambled for a QNB mandate.

Global coordinators say that they are working hard to bring international orders into the book for the IPO of Saudi Aramco, which is also attracting large pools of local demand.

State-owned airline Dubai Aviation Corporation, known as flydubai, has refinanced its debut sukuk into a term loan — a rare win this year for the loan market, which has declined while attractive issuance conditions boost DCM volumes.

Global banks working on Saudi Aramco’s IPO have dismissed claims that they are effectively sidelined and insist they are engaging international investors, despite the issuer’s decision not to roadshow outside the Gulf.

Saudi Aramco’s decision to make its IPO a local affair, with no international marketing, is a lacklustre end to what is nonetheless a huge capital markets event. Unrealistic objectives and hype have taken the shine off a monumental deal.

The IPO of Saudi Aramco will be a local affair after international investors made clear that they wanted a greater concession for the oil giant than the Saudi Arabia was willing to give.

Flourishing conditions in the sukuk market stepped up another gear this week as Qatar International Islamic Bank priced an additional tier one bond that one of its leads claimed was the tightest ever such trade from the Gulf Cooperation Council states.

One Middle Eastern bank is in the market with a sukuk additional tier one note, while a second announced it will go on the road for its own AT1.

Equity capital markets investors are waiting eagerly for the price range for Saudi Aramco's IPO and are hoping the Saudi state has listened to the feedback they have given it so far.

Saudi Aramco released an initial IPO prospectus on Sunday and some, mainly in the mainstream financial press, were outraged that it contained no details on price or deal size. However, a full two week investor education process is a perfectly normal feature of IPOs and the fact that Aramco is doing its deal by the book is a good thing.

Islamic Development Bank has spurred momentum in the green sukuk market, as it announced its debut, a euro deal, in the format this week.