Abu Dhabi sells more US dollar bonds by reopening April issuance

[DUBAI] Abu Dhabi is offering more US dollar-denominated bonds to the market, as governments in the Gulf region seek extra cash amid the economic downturn caused by the coronavirus pandemic and a slump in oil prices.

The government of Abu Dhabi has started marketing a "tap" of its existing dollar bonds, due in 2025, 2030 and 2050, which were issued last month, a document showed on Tuesday.

Under a bond tap, an existing transaction is reopened for subscription, using the same documentation as before.

It is offering around 165 basis points (bps) over US Treasuries for the US$2 billion bonds due in 2025, around 185 bps over the same benchmark for the US$2 billion bonds due in 2030, and around 3.5 per cent to 3.55 per cent for the US$3 billion notes due in 2050.

BNP Paribas, First Abu Dhabi Bank, JPMorgan and Standard Chartered have been hired to arrange the deal, the document showed.

The proceeds of the debt sale - which will likely be completed later on Tuesday - will be used for "general budgetary purposes", according to the document.

A spokesperson at Abu Dhabi's department of finance did not immediately respond to a request for comment.

Abu Dhabi issued the US$7 billion triple-tranche bonds in April just after a jumbo US$10 billion bond sale by Qatar.

Considered among the best credit in the region, oil-rich Abu Dhabi - the capital of the United Arab Emirates - received around US$45 billion in orders for the April deal.

REUTERS