Saudi Arabian Electricity Company (SEC) signed a revolving credit facility agreement with eight international banks on Thursday worth no more than $2.15 billion (eight billion Saudi riyals).
The facilities are divided into two tranches: the first values at $1.58 million, with three-year duration and the second tranche values at $572.5 million, with five-year duration, the company said.
SEC, the largest electricity supplier in the Middle East and North Africa and one of the world's largest service facilities, has managed to get funding without any guarantees from the company, with the arrangement and participation of major international banks, SEC’s CEO Fahad al-Sudairi said.
These banks are Abu Dhabi First Bank, Mizuho Bank, MOFG Bank, Standard Chartered Bank, Mitsui Sumitomo Bank, HSBC Middle East, Hong Kong and Shanghai Banking Corporation, JPMorgan Chase and Natixis, he explained, adding that the financing aims at spending on the company’s general businesses.
"The successful closure of these facilities, especially with the value and the best conditions, despite the current volatility in the financial markets, is a growing sign of confidence from international banks in the Kingdom’s economy and Saudi Arabian electricity company, which has a large asset base.”
Sudairi pointed out that these rotating credit facilities are an integral part of the company's financing strategy in order to obtain long-term funding in line with the company's assets and achieve maximum financial flexibility.
These rotating facilities help bridge future money from long-term financing and the ongoing payment requirements, which contribute to the formation of a harmonious mix of funding to support business operations and investments, improve the management and utilization of cash and reduce the liquidity and financing costs of the company.
