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Aramco, the Saudi oil giant, will sell two-part Islamic bonds

A term sheet obtained by revealed that Saudi Aramco has opened the books for the sale a U.S. Dollar Islamic bond (sukuk) with a maturity of five and ten years. The sukuk is expected to be priced later on Wednesday.

Aramco, a company in which Saudi Arabia is the majority shareholder and Aramco planned to raise debt to

Leverage your balance sheet

Last week, it was reported that oil prices were falling and the sale could generate between $3 billion to $4 billion.

The term sheet stated that the initial price target was 105 basis points above U.S. Treasuries for the five-year portion, and 115 for the longer-dated tranche.

Aramco’s issue coincides with a surge of bond issuance in the Gulf region, including Saudi Arabia’s $5.5 billion Sukuk. This was driven by strong investor interest and large inflows to bond funds.

It will also test the appetite of investors for regional deals, a day after Israel tried to kill Hamas political leaders with an

Airstrike on Qatari neighbour

The military action of the United States in the Middle East has been intensified.

Al Rajhi Capital Company is mandated as the active bookrunner on this transaction.

Saudi Aramco has not responded to an immediate request for comment on the transaction. (Reporting and editing by Christopher Cushing, Kim Coghill and Scott Murdoch)

(source: Reuters)