Allen & Overy (A&O) and Latham & Watkins have taken lead roles on the issuance of an international sukuk by Saudi Electricity Company (SEC), worth $2.5bn.
The transaction is thought to be the largest-ever Rule 144A sukuk offering, which allows it to be sold to international investors.
Allen & Overy advised longstanding client SEC on the deal, led by the firm’s European Islamic finance chief Atif Hanif, with capital markets partners Sachin Dave and Jamie Durham.
The partners were assisted by senior associate Cieren Leigh and associates Tracy Tond, Anne Korenblit and Edana Richardson. Partner Zeyad Khoshaim and associate Hosam Ghaith advised from the firm’s associated base in Riyadh.
Hanif said: “The bond had a 30-year tranche, which is the longest tenure of any international sukuk issuance. To take this legal structure to markets like the US and get a 30 year issuance is quite groundbreaking. They tend to be 10 years at the long end.”
Latham picked up a role for the joint lead managers from the firm’s New York, Dubai and London offices. Finance partner Harj Raj and capital markets partners Nomaan Raja and Lene Mathasen led on the deal alongside associates Lee Irvine, Muhannad Alnajjab, Ibrahim Soumrany and Theo Kalic.
Meanwhile, Walkers asset management partner Daniel Wood and associate Ciaran Bohnacker, both based in Dubai, advised as Cayman counsel to the issuer. The firm’s listing services chief, Theresa Redmond, advised on aspects relating to the listing of the sukuk certificates on the Irish Stock Exchange from Walkers’ Dublin office.
Allen & Overy has advised SEC on all five of its international sukuk issuances and on three of its four domestic issuances after the client switched firms alongside relationship partner Atif Hanif when he moved from Baker & McKenzie in 2008.
There has been a steady increase in activity related to the sukuk market in recent years. In January 2014, Linklaters won a mandate from HM Treasury to advise on the UK’s first-ever sovereign sukuk issue (31 January 2014).
Capital markets partner Elaine Keats is leading on the transaction alongside Linklaters’ Islamic finance chief Neil Miller and capital markets partner Richard O’Callaghan, both based in Dubai.
Luxembourg is also currently in the process of seeking state approval to issue an Islamic bond, while South Africa is planning to sell its debut international sukuk in 2014.