Vallianz taps the bond market in Saudi Arabia

Singapore-based offshore support vessel owner Vallianz Holdings has entered the bond market in Saudi Arabia by issuing a sukuk of SAR1bn ($277.7m).

The Shariah-compliant sukuk was issued through Rawabi Vallianz Offshore Services (RVOS), a joint venture between local partner Rawabi and Vallianz. Rawabi is one of Vallianz’s major shareholders.

The Sukuk has a fixed term of five years, with certain amortised principal repayments to be made during the period, followed by a bullet repayment of the remaining principal amount at the end of the tenor.

“Saudi Arabia is the ideal location to issue our first Sukuk as the country’s financial institutions and investors have deep knowledge and familiarity with the oil and gas business in the region,” said Sheikh Abdulaziz Alturki, group chairman of Rawabi Company Holding Limited and chairman of RVOS.

“Sukuk has become a prominent financing product in the world. It is an important funding channel that can provide the required liquidity to finance projects at an acceptable cost, as well as pave the way for other means of funding from financial and non-financial institutions, and individuals.”

The issuance was jointly led and managed by Alinma Investment, Saudi Fransi Capital, Saudi Hollandi Capital and GIB Capital in Saudi Arabia.

Ling Yong Wah, CEO of Vallianz, added that the issuance demonstrates major financial institutions’ “confidence in the prospects of RVOS and Vallianz, despite the current challenges facing the offshore and marine sector”.