PIF rakes in record loan

The Public Investment Fund revealed today that it has obtained a new senior unsecured term loan for USD 17 billion with a seven-year tenure.

This is the largest self-arranged term loan ever generated for general corporate purposes and it underlines PIF’s ambition to diversify its finance sources in order to encourage considerable investment in Saudi Arabia and around the world. The present PIF loan, a five-year, USD11 billion deal, will be returned early.

A large, international syndicate of 25 financial institutions from Europe, the US, the Middle East, and Asia supported the deal. In 2018, 15 financial institutions took part in PIF’s initial 11 billion lending facility. The transaction received more than twice as much interest this time.

The new loan is a component of PIF’s medium-term capital raising strategy and 2022 Annual Capital Raising Plan, which also contains a number of funding options to guarantee PIF’s ongoing and sustainable access to a variety of funding sources, both public and private.

Commenting, Fahad AlSaif, Head of Global Capital Finance Division at PIF said: “This new facility is a strong endorsement of PIF’s medium-term capital raising strategy.”

“It is a significant achievement for PIF, raising a record-sized term facility in the longest tenor ever for a loan of its size that is subscribed to by an unprecedentedly diversified number of lenders.  PIF will continue to explore a variety of debt funding sources as it delivers on its strategic objectives.”

In February 2022, PIF earned good international credit ratings from Moody’s and Fitch for the first time, demonstrating creditworthiness and the strength of its investment portfolio. PIF has a long-term financing strategy that is well-established and based on four funding streams, ensuring its capacity to support activity over the long-term. These funding sources include transfers of government assets to PIF, government capital injections, retained investment earnings, and loans and other debt instruments.

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