National Industries Group (NIG)has appointed National Bank of Kuwait (NBK)and Kuwait Financial House joint lead managers for a KD 35 million ($112.7 million) facility to be issued on 1 December. The bond will have a five-year tenor and annual interest of 6.25 per cent. The proposed bond will finance general-purpose operations at NIG. 'It [the bond] is part of NIG's strategy to diversify funding sources. They are adding long-term debt from non-banking sources,' says George Nasra, NBK's general manager (investment banking, asset management and treasury).

The proposed facility is the second bond issue to be staged by NIG. In 1998, the group issued a three-year facility of the same value, with an annual interest rate of 7.78 per cent.

The second bond is a KD 18 million ($58 million) facility to be floated by Kuwait Commercial Facilities Company (KCFC). The issue will be lead managed by NBK. It will have a five-year tenor and will offer a fixed interest rate to investors. 'The interest rate is being negotiated,' says Nasra.

The appetite of local companies for bond issues is increasing. In mid-October, Kuwait Projects Company (Kipco)announced that it would launch a KD 40 million ($129 million) floating bond, with a minimum interest rate of 6 per cent (MEED 26:10:01).