Saudi Electricity Company Successfully Prices $2.75 Billion Dual-Tranche Sukuk Including Green Tranche

The Saudi Electricity Company (SEC) has announced the successful pricing of a $2.75 billion dual-tranche senior unsecured RegS Sukuk under its international Sukuk Programme. This issuance includes two parts: a $1.25 billion 10-year green Sukuk with a profit rate of 5.489% annually and a $1.5 billion 5-year conventional Sukuk with a profit rate of 5.225% annually.

SEC's green tranche is its fourth under the Green Sukuk Framework, aimed at funding eligible green projects in renewable energy and efficiency. Since 2020, SEC has raised $3.75 billion through green Sukuks, underscoring its dedication to decarbonization and expanding its portfolio of green projects.

A virtual investor roadshow on February 10 attracted significant interest from Asia, Europe, and the Middle East. The issuance was priced the next day in an intraday transaction, with the order book exceeding $12 billion, indicating an oversubscription of 4.3 times.

SEC holds high investment-grade credit ratings from major agencies: Aa3 (stable) from Moody's, A+ (stable) from Fitch, and A (positive) from Standard & Poor’s. These ratings reflect SEC's strong financial standing and pivotal role in sustainable energy solutions.

The proceeds from the green tranche will finance or refinance projects aligned with SEC’s net-zero ambition by 2050 and support Saudi Arabia’s Vision 2030 energy transition goals. "This supports SEC’s net-zero ambition by 2050 and aligns with its ESG strategic objective of advancing Saudi Arabia’s energy transition in line with Vision 2030," said the release.

Acting CEO Eng. Khaled Al-Ghamdi stated that this issuance highlights SEC's ability to attract strong investor interest globally due to its robust credit standing. "This issuance reaffirms the company’s ability to attract strong investor interest in international markets, supported by its robust credit standing and pivotal role in providing sustainable and highly reliable energy solutions," he said.

Future Growth Plans

Al-Ghamdi also emphasized that this step is crucial for SEC's growth plans, which include enhancing electricity grid infrastructure, integrating renewable sources, and advancing digitalization efforts. "This issuance represents a significant step toward realizing our ambitious growth and expansion plans by injecting further investments into the electricity grid infrastructure," he added.

This initiative ensures SEC continues delivering high-quality electricity services that meet customer and shareholder expectations while contributing to the transformation towards sustainability as outlined in Saudi Vision 2030 targets.

With inputs from SPA