Tabreed Raises US$700 Million With Inaugural Green Sukuk Amid Strong Investor Demand

Tabreed has successfully raised US$700 million through its first five-year green sukuk, marking the initial issuance under a new US$1.5 billion trust certificate programme. This sukuk will be available for trading on the London Stock Exchange’s International Securities Market. The issuance attracted significant interest from local, regional, and international investors, leading to an oversubscription of nearly 2.6 times.

The strong demand for Tabreed's sukuk was bolstered by its investment-grade credit ratings from Moody’s (Baa3) and Fitch (BBB), which align with the company's corporate ratings. The profit rate for this sukuk is set at 5.279%, representing the tightest credit spread for a five-year instrument by Tabreed or any other UAE corporate sukuk with a similar rating this year.

The funds raised will support Tabreed’s Green Financing Framework, initially published in March 2022 and updated in February 2025. This framework aligns with the ICMA Green Bond Principles 2021 and LMA Green Loan Principles 2023. It is overseen by a multidisciplinary management committee led by Adel Al Wahedi, the Group’s Chief Financial Officer.

Tabreed plans to use the proceeds for financing and refinancing ‘Eligible Green Projects’. These projects focus on constructing, acquiring, and operating District Cooling schemes, as well as initiatives related to Energy and Water Efficiency and Wastewater Management.

Khalid Al Marzooqi, Tabreed’s CEO, expressed pride in their role in reducing carbon emissions while supporting societal progress through sustainable district cooling. He stated, "The importance this company attaches to ESG cannot be overstated and our investors know that the energy transition, of which we are at the very centre, is not only good for the environment but good for business, too."

Adel Al Wahedi also commented on the positive investor response to their first green sukuk. He said, "We are delighted with the investor response to our first green sukuk. This demonstrates the strength of our business model, financial stability and sustainability credentials of Tabreed."

This successful issuance highlights investor confidence in Tabreed's solid credit fundamentals and commitment to sustainability. The high demand reflects trust in their business model and financial health.

With inputs from WAM