United Arab Emirates borrowers at the opposite ends of the credit-rating spectrum are seizing on a lull in the U.S. Treasury rout to sell bonds.
Abu Dhabi wealth fund Mubadala Investment Co. is planning a dual-tranche offering denominated in euros, according to a person familiar with the matter. Mubadala issues its debt through a unit, Mamoura Diversified Global Holding PJSC, which has the third-highest credit grade from all three major rating companies.
Sharjah, a sheikdom with the lowest non-junk rating at Moody’s Investors Service and S&P Global Ratings, mandated HSBC Holdings Plc this week to arrange a sale of 12- and 30-year dollar bonds.
Both offerings should find buyers, according to Sergey Dergachev, senior portfolio manager for emerging-market debt at Union Investment in Frankfurt.
“Lower-rated sovereign and corporate credits tend to outperform due to their lower sensitivity to Treasury rates,” which should support the Sharjah deal, he said. Meanwhile, Mubadala’s sale will draw investors looking to pick up “quasi-Abu Dhabi sovereign risk,” he said.
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