ADQ Sets Price for Second $2 Billion Bond Issuance on London Stock Exchange

Post by: Raman Preet

Photo :Abu Dhabi Media Office

Abu Dhabi Developmental Holding Company PJSC (ADQ) has announced the pricing of its second bond issuance, amounting to a substantial $2 billion. This new bond is set to be listed on the London Stock Exchange (LSE) and follows ADQ's successful debut in the debt capital markets in May 2024.

The issuance is designed to diversify ADQ's funding sources, which will help finance strategic growth initiatives within the group and establish a long-duration credit curve for investors. This move is reflective of ADQ’s robust credit profile and the financial resilience of Abu Dhabi's economy.

Notably, the bond offering was met with overwhelming interest, being oversubscribed by an impressive 4.1 times. It consists of a dual-tranche offering, which includes a $1 billion bond with a seven-year maturity due in 2031, and another $1 billion bond with a 30-year maturity due in 2054. The respective annual coupon rates for these bonds are 4.375% and 5.250%. The strong demand from a diverse range of institutional investors allowed the transaction to tighten by 30 basis points from the initial pricing thoughts to the final pricing.

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Marcos de Quadros, Group Chief Financial Officer at ADQ, expressed his satisfaction with the results, stating, "ADQ’s second bond issuance under its Global Medium Term Note Program reflects our commitment to forward-looking financial management and a strong capital structure. With this issuance, we now offer an expanded bond curve to investors. We appreciate the impressive market response, demonstrated in the oversubscription of 4.1 times across both tranches."

Earlier in 2024, ADQ also completed its inaugural $2.5 billion bond issuance, which has a primary listing on the LSE and a secondary listing on the Abu Dhabi Securities Exchange (ADX). That dual-tranche bond achieved an oversubscription of over 4.4 times, showcasing continued investor interest.

As of June 30, 2024, ADQ's total assets reached $225 billion, reflecting its significant role in the Abu Dhabi economy. The company holds shareholdings in over 25 portfolio companies, structured into seven economic clusters, covering critical sectors including utilities, transportation, healthcare, agriculture, and real estate. Through these strategic investments and bond issuances, ADQ aims to bolster its contributions to the economic landscape of Abu Dhabi while maintaining a robust financial foundation.

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