Photo: The Mall of Arabia in Jeddah, Saudi Arabia, in September 2019. Leo Morgan/Shutterstock.com

Islamic Finance

Saudi shopping mall operator Arabian Centres issues debut sukuk


Arabian Centres Company has issued its debut sukuk.

"The Company would like to announce that it has completed the offering of such issuance and the settlement of the sukuk will take place on 29/3/1441H (corresponding to 26/11/2019G)," said Arabian Centres in a bourse filing on Wednesday (Nov 20).

The 5-year U.S.-dollar denominated paper is priced at a profit rate of 5.375%.

Saudi Arabia’s biggest mall operator said on Nov 7 that proceeds for the sukuk will be channelled to general corporate purposes, including to refinance existing debt.

Arabian Centres currently holds 19 malls in 10 Saudi cities in its portfolio, including 4,000 retail stores, according to its website.

The retail centres include Mall of Arabia and Nakheel Mall.

The company posted 208.2 million riyals ($55.52 million) in profit for the three months ending September 30, up by 8.49% from the same period last year.

It reported an occupancy rate of 93.2% across its 19 malls.

The company went public in May this year, in a 2.47 billion riyals ($659 million) initial public offering (IPO). 

The sukuk was assigned a rating of Ba2 by Moody’s and Arabian Centres expects it to be assigned a rating of BB+ by Fitch.

The company hired Goldman Sachs International and HSBC as Joint Global Coordinators. Credit Suisse, Emirates NBD Capital, Goldman Sachs International, HSBC, Mashreq Bank PSC, Samba Capital, and Warba Bank were appointed as joint bookrunners on the transaction.

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