Tabreed issues $700mln, inaugural green sukuk
Tabreed announced today the successful raising of US$700 million via an inaugural, five-year green sukuk – the first issuance under its new US$1.5 billion trust certificate issuance programme.
The new sukuk will be listed and traded on London Stock Exchange's International Securities Market.
The issuance of new green sukuk attracted strong institutional demand from high quality local, regional and international investors.
This led to the order books exceeding 4.6 times and final issue being oversubscribed by nearly 2.6 times, reflecting the high level of investor confidence in Tabreed's robust credit fundamentals.
The sukuk was competitively priced with a profit rate of 5.279%, achieving the highest tightening by any investment grade regional sukuk issuance this year and the tightest ever credit spread for a five-year instrument by Tabreed and or any other UAE corporate sukuk with a similar credit rating.
This high demand was supported by investment grade credit ratings from Moody's (Baa3) and Fitch (BBB), consistent with Tabreed's corporate ratings.
Proceeds from this latest sukuk will be used in alignment with Tabreed's Green Financing Framework, which was first published in March 2022 and later updated in February 2025.
It was developed in accordance with the ICMA Green Bond Principles (GBP) 2021 and the Loan Market Association (LMA) Green Loan Principles (GLP) 2023, and is governed by a multidisciplinary management committee led by the Group's Chief Financial Officer, Adel Al Wahedi.
Tabreed is thus able to issue green bonds and loans, with the resulting net proceeds to be used for financing and refinancing 'Eligible Green Projects' which include its core business of constructing, acquiring and operating District Cooling schemes, as well as projects related to Energy and Water Efficiency and Wastewater Management.
Following the sukuk announcement, Tabreed's Chief Executive Officer, Khalid Al Marzooqi, said, 'Tabreed's enviable reputation is built on the foundations of sustainability and operational excellence, so this, our first green sukuk, is perfectly aligned with our existing business while focussing on new developments.
'The UAE has an ambitious roadmap for net-zero and we are proud at Tabreed to play a vital role in preventing large scale carbon emissions while enabling societal progress through sustainable district cooling. The importance this company attaches to ESG cannot be overstated and our investors know that the energy transition, of which we are at the very centre, is not only good for the environment but good for business, too.'
Adel Al Wahedi, Tabreed's Chief Financial Officer, stated, 'We are delighted with the investor response to our first green sukuk. This demonstrates the strength of our business model, financial stability and sustainability credentials of Tabreed.'
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