Making a Splash

ACTME DEALS OF THE YEAR ★★★★★★★★★★★★★★★★★★★★★★★★★★★★★★★★★★★★★★★★★★ “Dolphin Energy 244km WHAT deserves to be the length of the THE Taweelah-Fujairah congratulated THE Pipeline that JUDGES for raising a very STATS transports gas to $9.5m SAID how much substantial sum the eastern region of the UAE Dolphin of money at an spent on efficient price $5.5m environmental the amount Dolphin protection during a volatile contributed in 2011 financial climate” in community investments in 2011 { CATEGORY CORPORATE FINANCIAL MANAGEMENT – WINNER DOLPHIN ENERGY} costs. Last year, a sale of the company’s debt was delayed MAKING A SPLASH after yields rose in the wake of investor concern over the Dolphin Energy got its timing right when it took the Arab spring and the European sovereign debt crisis. plunge to raise $1.3bn in senior secured bonds Dolphin, which is 51% owned by Abu Dhabi’s In a region where Mubadala Development Existing pipelines state support for DOLPHIN GAS PROJECT Dolphin constructed pipelines Company, produces and resource companies processes natural gas from is commonplace, Dolphin Qatar’s North Field and Energy stands out for going transports it through a subsea it alone. In February, pipeline to the UAE. Ras Laffan Dolphin raised $1.3bn in Mubadala’s structured senior secured project finance and capital markets UAE bonds to refinance existing QATAR team played a key role in the Doha Dubai commercial loans and Fujairah refinancing, acting on behalf undrawn commitments Jebel Ali of the shareholders. Mansour under the bank facility Taweelah Al Mulla, an adviser in the (worth $835m) as well as team, believes the success raise supplemental debt. Abu Dhabi OMAN of the deal owes a lot to the This makes it the second- Maqta unique characteristics of the largest project in the Al Ain project, as well as engaging region to successfully the debt capital market achieve migration. investor community and Demand was so strong Mansour Al easing access to information for the initial $1bn project Mulla: “We Highly commended: on the project. Dolphin bonds, priced at 5.50% were able to tell Zain KSA had previously issued the right story (the order book was a hefty and provide In July, telecoms company Zain KSA project bonds in 2009 and $8.6bn), that Dolphin was the right pulled off one of the most complicated subsequently kept investors able to issue a further $300m information equity capital market transactions in updated on the progress of in tap bonds priced at 5.34% to investors” Saudi Arabian history, when it raised the project. a few days later. This second $1.69bn in a rights issue following a cut “Investors want to in capital from SAR 14bn to SAR 4.8bn. issue garnered a $2bn order It was the largest deal to take place in understand what they’re book, with both issues Deal highlights Saudi Arabia since 2010 and the first putting their money in,” maturing in December 2021. Issuer: Dolphin Energy time that a capital reduction had been says Al Mulla. “We were able Meanwhile, investors in the Structure: Senior secured bond followed by a rights issue that included to tell the right story and secondary market seemed Guarantor ratings: A1 (Moody’s)/ both the conversion of debt into provide the right information A+ (Fitch) equally keen to snap up the equity and the issuance of fresh equity to investors and we are Amount: $1.3bn while the company’s stock continued bonds: over the first five Interest rate: 5.5% p.a./5.34% p.a. to trade on the stock exchange. The committed to continuing trading days, the bonds Tenor: 10 years transaction allowed the company to this collaborative approach.” traded up from par to 102.9, overhaul its balance sheet by writing Al Mulla also praises the while yield declined from off accumulated losses; reducing debt banks that acted as joint 5.5% to 5.13%. liabilities; increasing equity; expanding lead managers on the deal, Dolphin timed the bond and upgrading its network through saying they did a “good job capital expenditure; and rescheduling issuance carefully to take its other debt obligations to a at marketing and diversifying advantage of lower borrowing comfortable date in the future. the investor base”. www.treasurers.org/actmiddleeast October 2012 ACT Middle East Treasurer 13.

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