Fitch gives Saudi Electricity sukuk AA-

Fitch Ratings said it assigned Saudi Electricity Co.'s proposed domestic sukuk an expected AA-(EXP) rating.

The rating is in line with Saudi Electricity's AA- long-term issuer default rating and senior unsecured rating. The outlook for the long-term issuer default rating is stable.

The expected rating is driven by Saudi Electricity's issuer default rating and senior unsecured rating of AA-, due to the sukuk's structure, which Fitch said it expects to include the following features:

• Saudi Electricity's payment obligations under the sukuk are direct, unsubordinated and unsecured obligations of Saudi Electricity and the payment claims of the sukuk holders against Saudi Electricity under the sukuk will, rank at least pari passu with the claims of all other unsecured and unsubordinated creditors of Saudi Electricity;

• Saudi Electricity's undertaking to purchase the sukuk assets from sukuk holders on the maturity or any earlier dissolution dates, which as per the schedule equals 100% of nominal amount of all sukuk;

• During the life of the sukuk the price payable by Saudi Electricity in respect of the sukuk will be the sum of the aggregate face value of the certificates then outstanding (in addition to any periodic distribution amounts that have not been paid) covered by a servicing agency agreement, the purchase undertaking agreement and Saudi Electricity's commitment under a top-up mechanism; and

• Fitch's rating for the certificates therefore reflects the agency's belief that Saudi Electricity would stand behind its respective obligations under the documentation.

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