Oman scores bumper bond sale as investors shelve debt worries

Oman scores bumper bond sale as investors shelve debt worries
General view of Oman's capital Muscat. (Reuters)
Short Url
Updated 10 June 2021

Oman scores bumper bond sale as investors shelve debt worries

Oman scores bumper bond sale as investors shelve debt worries
  • Morgan Stanley said on Wednesday it prefers Oman, among the best performers on the Emerging Markets Bond Index, over Bahrain — the only other “junk” rated Gulf country

LONDON: Oman saw bumper demand in its first dollar-denominated sukuk sale since 2018 this week, as the rise in oil prices over the last year and a fiscal consolidation plan allayed investors’ concerns about a break-neck rise in debt levels.
The $1.75 billion nine-year sukuk drew over $11.5 billion in demand.
The sukuk were up about one cent on the dollar on Wednesday in the so-called grey market, market sources said. An S&P Global model called the Market Derived Signal Score shows that for the first time in more than two years, credit default swaps were not pricing a credit rating downgrade for Oman.
“They have set fairly cautious oil price assumptions, at $45 a barrel for this year, and $50 thereafter. But they have a plan to balance the budget at $50 by 2025,” said Timothy Ash at BlueBay Asset Management, adding he now sees Oman as an improving credit story.
He said he expected its budget to outperform given higher oil prices, with Brent crude at over $72 on Wednesday.
“Recent demonstrations have underlined that reforms are not easy, but we see real commitment to reform, but also to improve transparency, which is really encouraging from an investor perspective,” Ash said.
Last month Oman saw hundreds of Omani men protest demanding jobs, handing its new ruler Sheikh Sultan his biggest challenge since taking the throne last year following the death of Sultan Qaboos — in power for five decades.
Morgan Stanley said on Wednesday it prefers Oman, among the best performers on the Emerging Markets Bond Index, over Bahrain — the only other “junk” rated Gulf country.
“While we have tempered our optimism with the rally, we maintain a positive bias and think that it’s too early to cut exposure as fiscal consolidation should remain on track,” Morgan Stanley said in a research note.
Oman faced what bankers called lacklustre demand when it tapped the debt markets last year, but the consolidation plan and oil price recovery helped Oman become the first Gulf sovereign to issue bonds in January, raising $3.25 billion with conventional bonds sold out of a $15 billion orderbook.
“With the latest issue Oman has refinanced bonds expiring in 2021 and the current public deficit... allowing the government to concentrate on the budget deficit consolidation,” said Raffaele Bertoni, head of debt capital markets at Gulf Investment Corporation.


Saudi SABIC, ExxonMobil begin operations of petrochemical JV on US Gulf Coast

Saudi SABIC, ExxonMobil begin operations of petrochemical JV on US Gulf Coast
Updated 20 January 2022

Saudi SABIC, ExxonMobil begin operations of petrochemical JV on US Gulf Coast

Saudi SABIC, ExxonMobil begin operations of petrochemical JV on US Gulf Coast

RIYADH: Riyadh-based Saudi Basic Industries, also known as SABIC, one of the leading petrochemical firms worldwide, announced the start of operations of its petrochemical joint venture with US ExxonMobil.

US Texas is to witness the launch of an ethylene production unit – operating an annual capacity of around 1.8 million tons, the homegrown petrochemical company said in a statement.

The new production unit, which started construction in 2019, will produce materials to be utilized in packaging, agricultural film, construction materials, clothing, and automotive coolants.

This project is in line with SABIC’s strategy, aimed at diversifying its feedstock as well as strengthening its position in North America.

“This is a remarkable achievement that positions us well to help meet growing global demand for performance products while providing meaningful investment in the US Gulf Coast,’ president of ExxonMobil Karen McKee said, commenting on the partnership.

SABIC noted that the deal’s financial impact is expected to roll out on the company’s financial statements during the ongoing quarter.

In the latest trading session, shares of the company edged down by 0.2 percent to close at SR126 ($33.6).


Mastercard, Coinbase partner to make NFTs more accessible

Mastercard, Coinbase partner to make NFTs more accessible
Updated 20 January 2022

Mastercard, Coinbase partner to make NFTs more accessible

Mastercard, Coinbase partner to make NFTs more accessible

RIYADH: Payments giant Mastercard has partnered with cryptocurrency exchange Coinbase to make non-fungible tokens more accessible.

Mastercards can be used to make purchases on Coinbase’s upcoming NFT marketplace.

“We’re excited to announce today that we’re partnering with Coinbase to let people use their Mastercard cards to make purchases on Coinbase’s upcoming NFT marketplace,” Mastercard said in a statement.

“Getting more people involved safely and securely is perhaps the best way to help the NFT market thrive.”

Mastercard also sees greater potential for core NFT technology to go beyond art and collectibles in many other areas.

Coinbase announced in October last year that it is launching an NFT marketplace.

“Coinbase NFT, as a peer-to-peer marketplace that will make minting, purchasing, showcasing and discovering NFTs easier than ever,” Coinbase said.

“We’re making NFTs more accessible by building user-friendly interfaces that put the complexity behind the scenes. We’re adding social features that open new avenues for conversation and discovery. And we’re going to grow the creator community exponentially, a win for artists and for fans.” 


Saudi Wafrah appoints Khaled Saleh Al Amoudi as CEO

Saudi Wafrah appoints Khaled Saleh Al Amoudi as CEO
Updated 20 January 2022

Saudi Wafrah appoints Khaled Saleh Al Amoudi as CEO

Saudi Wafrah appoints Khaled Saleh Al Amoudi as CEO

RIYADH: Saudi food firm Wafrah for Industry and Developments has appointed Khaled Saleh Al Amoudi as CEO on Thursday, according to a bourse statement. 

The decision follows recommendation from the Remuneration and Nomination Committee.

With a M.Sc.in Financial Management, Al Amoudi currently holds the chief financial officer position at the firm, with more than 20 years of accumulated experience as CFO and in the governmental and bank sectors.


Tadawul approves $755m government debt listing

Tadawul approves $755m government debt listing
Updated 20 January 2022

Tadawul approves $755m government debt listing

Tadawul approves $755m government debt listing

RIYADH: Saudi stock exchange Tadawul approved listing of SR2.83 billion ($755 million) worth of government debt instruments, submitted by the Ministry of Finance, according to a bourse filing.

The first issuance dated January 8, amounts to SR1.25 billion, Tadawul said in a statement.

The second issuance dated January 12, is valued at SR1.59 billion.


Profits of Saudi-based SADAFCO drop 28.6% as pandemic hits sales

Profits of Saudi-based SADAFCO drop 28.6% as pandemic hits sales
Updated 20 January 2022

Profits of Saudi-based SADAFCO drop 28.6% as pandemic hits sales

Profits of Saudi-based SADAFCO drop 28.6% as pandemic hits sales

RIYADH: Saudia Dairy and Foodstuff Co., or SADAFCO, reported a 28.6 percent decline in profit during the nine months ending Dec. 31, 2021. 

Profits dropped to SR146 million ($38.9million), compared to SR205 million in the corresponding period a year earlier, the company announced in a bourse statement.

SADAFCO attributed the lower profit figures to lower sales volumes driven by the pandemic, an increase from 5 percent to 15 percent in VAT, and higher material and logistics costs.

The financial statements of the company indicated a healthy cash flow, with a strong cash position of SR679 million.

SADACFO’s share price edged down by 0.12 percent in today’s session to close at SR167.

Earlier, the company’s board recommended cash dividends at SR3 per share for the first half of the fiscal year ended Mar. 31, 2022.

Jeddah-based SADAFCO operates sales and distribution depots in 24 locations across Saudi Arabia, Bahrain, Qatar, Jordan, and Kuwait. Its products are also exported to several countries in the MENA region.