(Adds background, details)
By Davide Barbuscia
DUBAI May 18 Oman has appointed banks to
arrange a global fixed income investor call ahead of a potential
dollar sukuk issuance which would be the first public
international sale of Islamic bonds by the Gulf state.
The planned sale, expected to raise around $2 billion, would
be in addition to a $3.6 billion syndicated loan that Oman is in
the process of agreeing with Chinese lenders.
Rating agency Standard & Poor’s downgraded the Sultanate to
"junk" status last week, citing the erosion of the country's
external reserves and Oman's vulnerability to potential
volatility in oil prices.
Despite its budget deficit and the weakening of external
buffers, Oman issued in early March a successful $5 billion
international bond -- its largest ever -- which drew orders in
excess of $20 billion.
Oman has mandated Al Izz Islamic Bank, Citi, Dubai Islamic
Bank, Gulf International Bank, HSBC, JP Morgan and Standard
Chartered Bank for the planned seven-year sukuk. The banks will
arrange a global investor call on May 22.
The offering could also include a 12-year tranche, a
document issued by one of the banks leading the deal showed.
Oman returned to the international debt capital markets last
year for the first time since 1997.
It raised a total of $4.5 billion through five- and 10-year
conventional bonds in June, followed by a tap of those bonds in
October. It also sold a $500 million six-year sukuk in June
under a private placement.
In March, the sovereign raised debt at maturities of five,
10, and 30 years.
Oman is rated Baa1 with a stable outlook by Moody's, BB+
with a negative outlook by S&P, and BBB with a stable outlook by
(Editing by Catherine Evans)