(Updates with size, launch, demand, final spread)
DUBAI, Feb 15 (Reuters) - The government of Sharjah, one
of the seven United Arab Emirates, is set to raise $1 billion
from a sale of nine-year debut sustainable bonds, a document on
the debt sale showed on Wednesday.
"This is the first sustainable sovereign bond in the GCC
(Gulf Cooperation Council), which indicates that the proceeds
will be used for environmental or social purposes. This is
broader than the 'green bonds' which several Gulf states
including Qatar, Bahrain and Saudi Arabia have been
considering," said Justin Alexander, director of Khalij
Economics and Gulf analyst for GlobalSource Partners.
There is growing demand by investors globally for
financing linked to environmental, social and governance
factors, and issuers in the Gulf have increasingly sought to tap
such debt.
Sharjah's bonds were set at a spread of 280 basis points
over U.S. Treasuries, the document seen by Reuters showed.
Initial price guidance was around 310 basis points over
U.S. Treasuries maturing in February 2033, a separate document
on the sale showed earlier.
HSBC is the global coordinator. Abu Dhabi Commercial Bank,
Citi, Gulf International Bank, Intesa Sanpaolo, Invest Bank and
SMBC Nikko are joint lead managers and bookrunners.
Sharjah needs about $4.7 billion in financing this year for
a $2.3 billion budgeted deficit and $2.4 billion in maturing
bank loans, Alexander wrote in a research note last week.
(Reporting by Yousef Saba in Dubai and Yoruk Bahceli in
Amsterdam; Editing by Kim Coghill and Paul Simao)
