Muscat, Augst 2017 - The Government of the Sultanate of Oman signed a USD 3.55bn 5-year senior unsecured term loan on 11 July, 2017 with a group of Chinese financial institutions. The term loan follows the Sultanate’s USD 5.0bn multi-tranche bond and USD 2.0bn sukuk priced earlier this year. The transaction witnessed strong interest from the group of leading Chinese banks with the transaction upsized from the initial target of USD 2.0bn to accommodate the interest from the lenders.
The transaction was noteworthy in a number of ways and was able to fulfil Sultanate’s key objectives such as:
• Complete Government’s external funding requirement for 2017.
• Diversification of funding sources from the debt capital markets and the traditional source of Western/regional banks funding
• A milestone transaction and a first for the region, where only Chinese financial institutions were invited to participate in a loan that introduced new pool of investors to the Sultanate of Oman.
’ The transaction saw significant demand from the Chinese lending base, reaffirming lenders’ continued belief in the Sultanate’s long-term credit fundamentals.
The USD 3.55bn transaction size also represents the largest ever deal size achieved for a regional borrower exclusively in the Chinese market. The strong demand supported the competitive pricing and enabled Oman to upsize the facility.
The transaction was self-arranged by the newly established Debt Management Office in the Ministry of Finance.
“We are delighted to see the strong interest and support from the Chinese financial institutions and companies to increase their investments in Oman. The transaction demonstrates the continued confidence of International investors in Oman. With this loan we have successfully completed the financing requiremens for the expected 2017 fiscal deficit, and also been able to meet the refinancing needs in relation to some of the loan instalments that fell due during the year. ” said the Undersecretary of the Ministry of Finance, H.E. Nasser Khamis Al Jashmi.