Emirati port operator DP World has issued MENA’s first blue bond worth USD 100 mn, according to a statement released on Thursday. The issuance is also the first corporate blue bond out of the broader Central and Eastern Europe, Middle East, and North Africa region.

SOUND SMART- What is a blue bond? A blue bond is a facility that supports sustainable marine and fisheries projects. It is used by governments or development banks to raise funds from key investors to finance marine and ocean-based projects.

Tightest spread for DP World so far: The five-year blue bond was priced at a spread of 99.6 bps above US treasuries — representing DP World’s tightest-ever spread in the bond or sukuk market. It also came with a 5.25% coupon rate.

Where will the money go? The funds will go towards several projects, including sustainable port development, expanding marine ecosystem conservation and restoration projects, and marine pollution initiatives.

REMEMBER- DP World listed a debut USD 1.5 bn green sukuk on Nasdaq Dubai in November 2023 and the London Stock Exchange in October 2023. The 10-year sukuk issuance debuted in September 2023 garnering high demand with the order book reaching USD 3.4 bn, making it c.2.3x oversubscribed. The green sukuk were priced at 119 bps above the US treasuries with a 5.5% coupon rate. This issuance brought DP World’s listed sukuk value to USD 4 bn under its USD 5 bn Trust Certificate Issuance Program.

ADVISORS- Global investment management firm T. Rowe Price Associates was the main investor, while Citigroup supported the port operator in arranging the issuance under its updated sustainable finance framework.

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