ADX-listed Abu Dhabi Developmental Holding Company (ADQ) has announced its inaugural $2.5 billion bond issuance on the London Stock Exchange (LSE) as part of an effort towards diversifying its funding sources.
The combined order book peaked at over $11 billion, reflecting an oversubscription of more than 4.4 times, the fund said in a statement. The issuance attracted major investors across Asia, the US, the Middle East, the UK and Europe.
ADQ sold a $1.25 billion five-year portion at 80 basis points (bps) over US Treasuries (UST), fixed at a rate of 5.5%. Meanwhile, its $1.25 billion 10-year tranche was at 90 bps over the same benchmark, achieving a coupon rate at 5.57% per annum.
“The significant market response to our inaugural bond issuance validates the strength of ADQ’s credit profile, which benefits from the stability and resilience of the wider Abu Dhabi economy,” said Mohamed Hassan Alsuwaidi, Managing Director and CEO of ADQ.
“Furthermore, it is reflective of investor confidence in Abu Dhabi’s capital markets and in ADQ’s compelling growth prospects, which are anchored in the execution of our transformative mandate in sectors providing essential services and products to people in the Emirate and beyond.”
The proceeds from the offering will serve as growth capital and facilitate further investments in strategic initiatives, driving the economic diversification of Abu Dhabi.
Marcos de Quadros, CFO at ADQ, added, “Going forward, the programme will enable us to utilise debt capital markets as an effective option to fund our long-term investments and continue to support Abu Dhabi’s sustainable economic development.”
ADQ’s total assets amounted to $196 billion at the end of 2023. The fund has shareholdings in more than 25 portfolio companies across numerous critical infrastructure assets spanning utilities, transportation, healthcare, agriculture and real estate.
ADQ is rated Aa2 by Moody’s and AA by Fitch.
