Saudi's Neom hunts for more cash for $1.5 trn desert city

Saudi Arabia's Neom is planning its debut riyal bond sale for later this year as it looks for more sources of funding for the $1.5 trillion worth of construction projects it's planned for the futuristic city, according to sources.

Neom has appointed banks including HSBC Holdings and the securities units of Al-Rajhi Bank and Saudi National Bank to advise on the sale of Islamic bonds, or sukuk, the people said. The debt would be denominated in the local currency and could raise as much $1.3 billion, they said, asking not to be identified as the information is private.

The sukuk sale could come as early as the second half of this year. A final decision on the timing and offering size will depend on market conditions.

Representatives for Neom, HSBC, and Saudi National Bank declined to comment, while a spokesperson for Al-Rajhi Bank did not respond to a request for comment.