Pvt sector interest in Dubai bond unlikely

The most likely buyers for Dubai’s second $10 billion bond will be the UAE’s central bank again or the government of Abu Dhabi as the offering will not be attractive enough for private investors, a leading ratings analyst said on Sunday.

“We expect that a large part if not all of that bond will be purchased by (the central bank or government of Abu Dhabi),” Farouk Soussa, head of Middle East government ratings for Standard & Poor’s, told journalists at the sidelines of a conference.

“The pricing that the government of Dubai is likely to be able to get in the market will look much less attractive than the pricing it will be able to get from the UAE,” Soussa said, adding that "there is no commitment by anybody so far that we are aware of" for the second tranche.