Middle East

Turkey was, yet again, at the fore of market participants’ minds on Tuesday. As inflation spikes, the country has indicated its intention to encourage more borrowing following a debt issuance spree in June.

The IPO of Al Yah Satellite Communications Co, the Abu Dhabi satellite company, is covered throughout the initial price range, on a 30% deal size, according to sources close to the deal.

The Emirate of Sharjah is returning to the international bond market just months after its last visit, but this time marketing a sukuk that will place it among the ranks of major emerging market issuers — both sovereign and corporate — to have raised cash at competitive levels recently with the Sharia-compliant instrument.

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Turkey, Cameroon and Latvia all entered international bond markets on Wednesday. Investors said the sovereigns are rushing to secure funding while conditions are still positive, amid the anticipation of rate rises.

Emaar Properties, the UAE-based luxury real estate developer, was planning to sell a dollar sukuk on Tuesday. It followed a string of emerging market Sharia-compliant trades in recent weeks that have been absorbed by a hungry investor base.

The IPO of Yahsat, the Abu Dhabi satellite company, will be the largest flotation in the United Arab Emirates for almost four years, according to terms published on Sunday.

State-owned Qatar Petroleum was in the bond market on Monday with a multi-tranche bond that included a Formosa issue. Investors, meanwhile, say they expect the sovereign — one of the only Gulf states to have been absent from markets so far this year — to sell bonds imminently.

Several FIG issuers across CEEMEA entered bond markets to raise cash this week. Meanwhile, the pipeline for bank issuance is strong as issuers take advantage of attractive market conditions to bolster reserves.

Anadolu Efes, the Turkish brewer, returned to the market this week to issue a new bond and launch a tender for its dollar debt. Investors say it is one of the more attractive credits from the country, despite domestic economic volatility.

More emerging market issuers will issue convertible bonds following landmark deals in Turkey and the United Arab Emirates in recent weeks. The asset class is seen as a way for EM companies to raise capital while avoiding rising interest rates and to showcase the increasing sophistication of their home exchanges. Aidan Gregory reports.

ING Turkey, a subsidiary of the Dutch banking group, has signed an ESG-linked syndicated loan, making it the latest Turkish lender to embrace labelled debt, a trend that bankers insist is motivated by a commitment to sustainability and not simply an attempt to lower pricing.