PIF Secures Largest Ever General Corporate Purpose Loan Globally

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  • The USD 17billion term loan is the first of its kind, and was twice oversubscribed
  • Loans and Debt instruments are one of PIF’s four sources of funding as part of its strategy
  • The facility was self-arranged with 25 banks globally across Europe, the US, the Middle East and Asia

Riyadh, Saudi Arabia: The Public Investment Fund (“PIF” or the “Fund”) today announced that it has secured a new USD 17 billion, seven-year senior unsecured term loan.

This represents the largest self-arranged term loan ever raised for general corporate purposes, supported by significant demand from an international syndicate and reflects a continuation of PIF’s strategy to diversify its sources of funding, helping to drive impactful investment in Saudi Arabia and internationally. PIF’s existing USD11billion, five-year loan, arranged in 2018, will be repaid early.

The transaction was supported by a broad based, global syndicate of 25 financial institutions from Europe, the US, the Middle East and Asia. The transaction was more than twice oversubscribed. PIF’s original 11bn loan facility in 2018 saw 15 financial institutions participate.

The new loan forms part of PIF’s medium-term capital raising strategy and its 2022 Annual Capital Raising Plan – the plan includes several funding tools that would ensure PIF continuous and sustainable access to diverse funding sources, including 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.”

PIF received strong international credit ratings from both Moody’s and Fitch for the first time in February 2022, underlining the creditworthiness of the Fund and the quality of its investment portfolio. PIF has a well-established long-term financing strategy that is built around four sources of funding, ensuring its ability to finance activity over the long-term. These sources include capital injections by the government, government asset transfers to PIF, retained earnings from investments, and loans and debt instruments.

About PIF

The Public Investment Fund (“PIF” or the “Fund”) is one of the largest and most impactful sovereign wealth funds in the world. Since 2015, when the Board was reconstituted and oversight transferred to the Council of Economic and Development Affairs, the Fund’s board of directors has been chaired by His Royal Highness Crown Prince Mohammad bin Salman bin Abdulaziz Chairman of the Council of Economic and Development Affairs, and Chairman of the Public Investment Fund. The Fund plays a leading role in advancing the Kingdom of Saudi Arabia’s economic transformation and diversification, as well as contributing to shaping the future of the global economy. Since 2017, the Fund has established 66 companies and created, directly and indirectly, over 500,000 jobs as at the end of 2021.

PIF is building a diversified portfolio by entering into attractive and long-term investment opportunities in 13 strategic sectors in the Kingdom of  Saudi Arabia and globally. The Fund’s strategy, as set out in the PIF Program 2021-2025 – one of the Vision 2030 realization programs – aims to enable many promising sectors and contribute to increasing local content by creating partnerships with the private sector, in addition to injecting at least 150 billion riyals annually into the local economy. PIF works to transfer technologies and localize knowledge to build a prosperous and sustainable economy in the Kingdom of Saudi Arabia. As the investment arm of the Kingdom of Saudi Arabia, the Fund looks to make unique investments, and is building strategic alliances and partnerships with prestigious international institutions and organizations, which contribute to achieving real long-term value for the Kingdom in line with the objectives of Vision 2030. PIF has also created an operational governance model that reflects its main tasks and objectives, in line with best international practices. Applying this model of governance enhances the level of transparency and effectiveness in decision-making and future progress.