Kuwait Pro Co(Cymn)

Issue of Debt

RNS Number : 2016P
Kuwait Projects Co. (Cayman)
12 July 2010


Immediate Release


KIPCO completes US$500m bond issue


A rare single-tranche 10-year issue from a GCC credit and the first ever 10-year RegS international private sector transaction from the region


A second consecutive highly successful offering on the back of the USD500mn 7-year new issue placed in 2009




Kuwait City, July 12th, 2010:KIPCO - the Kuwait Projects Company - has announced the successful completion of a US$500 million (KD 144 million) bond issue under its US$2 billion Euro Medium Term Note (EMTN) Programme.


This pioneering transaction marks the first international bond issue by a private sector corporate from the MENA region in 2010, as well as the first US$ denominated offering from a Kuwaiti institution since 2009. This transaction followed on the back of a highly successful US$500 million 7-year offering from KIPCO in 2009.


The 10-year fixed-rate note is listed on the London Stock Exchange. Carrying a fixed-rate coupon of 9.375%, it priced at a spread of 644.2bps over the US Dollar Mid-swap curve and 647.3bps over the US Treasury curve respectively. The issue was 3.6 times oversubscribed.


This transaction represents a rare single-tranche 10 year issue from a GCC credit and was a compelling strategic choice offering debt maturity extension and asset liability optimisation. The proceeds of the issue will be used to extend the company's maturity profile and further diversify KIPCO's investor base.


The bond issue also continues KIPCO's strategy of regularly raising money in the debt market to diversify its investor base and offer financial flexibility. Both KIPCO and the notes issued under its EMTN Programme have a BBB- rating from Standard & Poors and a Baa2 rating from Moody's.


The bond order-book closed at US$1.8 billion, with allocation widespread across the globe. The UK accounted for 19% of the total order-book, Switzerland 26%, Europe 7%, Asia 19%, the Middle East 9% and offshore US accounts 20%. The issue attracted a wide range of investors including leading fixed-income global institutions.


Mr Pinak Maitra, KIPCO's Group Chief Financial Officer, said:


"We are delighted with the response from international investors to this latest transaction under our bond programme. The volatile market backdrop did not derail our efforts to access 10 year funding at a similar cost to previous successful bond offerings. The deal also confirms KIPCO's leadership as a role model for private sector corporates in the MENA region and our consistent ability to access debt capital markets. The transaction will allow us to refinance debt maturing next year and extend our credit curve to 2020."


The joint lead managers on the transaction were BNP Paribas, Citi and HSBC.


-    Ends -


Notes to Editors:


About the bond issue:

The Base Prospectus for the EMTN programme is available for viewing at http://www.rns-pdf.londonstockexchange.com/rns/7601N_1-2010-6-16.pdf.


This replaces the previous Base Prospectus and supplemental Base Prospecti previously issued under the programme.


About KIPCO:

The KIPCO Group is one of the biggest diversified holding companies in the Middle East and North Africa, with consolidated assets of US$ 18.7 billion. The Group has significant ownership interests in a portfolio of over 60 companies operating across 26 countries. Its main sector focus is financial services, insurance and media. Through the subsidiaries and affiliates of its core companies, KIPCO has interests in the real estate, manufacturing, aviation, education and management advisory sectors.


Further information:


Robert Hipkins                 Group Communications Director                 +965 6635 6969


Saad Al Ali                      Group Marketing and PR Director               +965 9958 0440


This information is provided by RNS
The company news service from the London Stock Exchange