SABIC tightens guidance on 750m euro bond

DUBAI: Saudi Basic Industries Corp. (SABIC) twice tightened pricing guidance for its 750 million euro-denominated bond prior to launch on Wednesday on healthy investor demand, documents from lead managers said.
Revised guidance for the transaction was set at 135 basis points over midswaps, having been tightened to 140 bps, plus or minus 5 bps, over the same benchmark less than an hour before,
two separate documents said.
Orders from investors totalled 3.5 billion euros ($4.7 billion), with books having been given as 2.7 billion euro when the guidance was tightened the first time.
The firm, one of the largest petrochemicals companies in the world, is aiming to issue a deal with a seven-year lifespan and had earlier issued initial thoughts on pricing in the area of 150 basis points over midswaps.
SABIC completed roadshows in Europe on Tuesday, having announced last week it had mandated Credit Agricole, ING, JP Morgan Chase, Mitsubishi UFJ and Standard Chartered for the possible trade, which will be issued through its SABIC Capital subsidiary.
Earlier Fitch Ratings has assigned SABIC Capital I B.V. proposed guaranteed bonds an expected senior unsecured '”A+ (EXP)” rating.
The rating is in line with SABIC’s; A+/Stable/F1) senior unsecured 'A+' rating.
The issuer, SABIC Capital I B.V., is a finance and investment vehicle wholly-owned by SABIC.

The bonds will benefit from a direct, unconditional, general and irrevocable guarantee from SABIC and will rank pari passu with SABIC's existing and future senior unsecured and unsubordinated obligations. The proceeds will be used for general corporate purposes, including loans to companies of SABIC Group outside Saudi Arabia, and to repay some of the group's outstanding debt.