May 9, 2019 / 6:08 AM / 3 months ago

Saudi Arabia's Savola plans riyal sukuk issue

DUBAI, May 9 (Reuters) - Savola Group, Saudi Arabia’s largest food products company, said on Thursday it plans to issue sukuk denominated in Saudi riyals, as part of a sukuk programme of up to 5.3 billion riyals ($1.41 billion).

The company said it will issue the sukuk, or Islamic bonds, to back the company’s financial and strategic needs.

Savola and other consumer goods companies in Saudi Arabia are suffering from the effects of subsidy cuts, the introduction of VAT and an exodus of expatriates which have all put pressure on consumer spending.

The planned issue comes after Saudi Arabia last month reduced fees for new debt offerings and annual registration charges for issuers, as part of efforts to spur activity in the local debt market. ($1 = 3.7503 riyals) (Reporting by Tuqa Khalid, editing by Davide Barbuscia)

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