State-led utility Saudi Electricity (SEC) announced on the Tadawul exchange on 27 August that it has signed a seven-year syndicated Murabaha facility agreement with seven Saudi banks for SR9bn ($2.4bn). The money, received by SEC on 26 August, will be used for “general corporate purposes including capital expenditure.” SEC lists the lenders as the National Commercial Bank, Bank Albilad, Al Rajhi Bank, Riyad Bank, Samba Financial Group, Banque Saudi Fransi and the Saudi British Bank.
The funding is SEC’s first since a SR15.2bn ($4.05bn) Murabaha loan in February 2019, also for corporate and capex funding. SEC’s biggest year for lending from the financial market was 2016, when it raised $5.13bn, although its largest deal was a $13.2bn Ministry of Finance ‘soft loan’ in 2014 (see table and MEES, 26 January 2018). SEC’s need for capex will likely be reduced by its decision to pursue independent power producer (IPP) projects rather than self-financing new capacity (MEES, 15 November 2019). (CONTINUED - 158 WORDS)