Abu Dhabi, UAEThursday 29 October 2020

Taqa finalises issuance of $500 million bond

The proceeds of the offering will be used for repayment of outstanding debt, the company said

ADPower will own 98.6 per cent of Taqa shares following the deal, but a follow-on share offer could be made to broaden the company's investor base. Courtesy Taqa
ADPower will own 98.6 per cent of Taqa shares following the deal, but a follow-on share offer could be made to broaden the company's investor base. Courtesy Taqa

Abu Dhabi National Energy Company (Taqa) finalised the issuance of 30-year bonds worth $500 million (Dh1.8 billion), the company said in a statement on Abu Dhabi Securities Exchange. The bonds will carry a coupon and re-offer yield to maturity of 4 per cent.

“The proceeds of the offering will be used for the repayment of other outstanding debt,” the company said.

Taqa hired BNP Paribas, First Abu Dhabi Bank, JPMorgan, MUFG, Societe Generale and Standard Chartered Bank to arrange the deal, according to a report by Reuters.

The deal comes amid a flurry of international debt issuance from the Gulf region, as governments and companies take advantage of low global rates to raise cash after the US Federal Reserve cut rates again this month.

In the second quarter, Taqa’s profit surged 24 per cent as revenue climbed on higher oil and gas production. Profit attributable to shareholders reached Dh208m in the three months ending June 30, while quarterly revenue climbed 9 per cent to Dh4.66bn year-on-year.

Liquidity as of June 30 remained at Dh12.8bn, including Dh2.6bn in cash and cash equivalents, and Dh10.2bn of undrawn credit facilities, according to Taqa. Debt stood at Dh64.5bn.

In July Moody's Investors Service affirmed Taqa's long-term issuer rating and upgraded the state-controlled oil and gas investment company's baseline credit assessment (BCA) on improved operational performance.

The ratings agency affirmed an A3 long-term issuer rating with a stable outlook, reflecting expectations that Taqa will continue to benefit from state support, Moody's said. It also upgraded Taqa's BCA by a notch to B1 from B2.

Updated: September 30, 2019 02:59 PM

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