Derayah LLPC

Number of lawyers worldwide: 12

Languages: Arabic, English

Firm Overview:

Derayah LLPC (formerly Hatem Abbas Ghazzawi & Co.) is an independent Saudi Arabian law firm. The firm regularly acts in high profile transactions and has developed a reputation for providing quality advice on some of the largest and most complex projects in Saudi Arabia. It remains the first-choice Saudi counsel for many foreign companies and international law firms seeking advice on Saudi Arabian law.

Main Areas of Practice:

Dispute Resolution:

The dispute resolution department provides general litigation and arbitration services and has particular expertise in banking disputes, capital market disputes, government contract claims, agencies and distributorships, shipping, insurance, and providing expert evidence on Saudi Arabian law in overseas proceedings. The firm is currently involved in six bankruptcy proceedings, including the Maan Al Sanea/Saad Trading financial reorganisation procedure involving claims totaling US$ 21 billion, the first financial reorganisation under the new Saudi Arabian bankruptcy legislation that was enacted in 2018. The firm also provided expert evidence on Saudi Arabian law in English High Court proceedings brought by the liquidators of Saad Investments Company against SAMBA Financial Group, in connection with a claim for US$ 318 million.

Projects & Energy:

The projects and energy department frequently acts as local counsel to sponsors, lenders and borrowers involved in major power and water projects in Saudi Arabia, both public and private.

Derayah LLPC were local counsel to the consortium that Saudi Arabia’s Water & Electricity Company selected as preferred bidder for the planned Dammam West ISTP. The consortium is led by the UAE-headquartered Metito, and also includes Saudi Arabia’s Mowah and Egypt’s Orascom Construction. The US$ 245 million project reached financial close in June 2020. The Dammam ISTP has a designed capacity of 350,000 cubic meters per day and an initial capacity of 200,000 cubic meters per day, and will be developed under a 25-year sewage treatment agreement.

The firm has additionally been involved in the following private power and water projects in Saudi Arabia:

■ The lenders in the first IPP (SADAF);

■ The sponsors in the first IWP (Rabigh);

■ The lenders in the first IWPP (Shoaiba) and its subsequent expansion;

■ The borrower in the Qurayyah IPP, the world’s largest IPP;

■ The winning bidder in the Rabigh IWSPP;

■ The lenders for the Shuqaiq IWPP;

■ The sponsors in the first solar power project.

The firm advised Dow Chemical Company (Dow) and Sadara Chemical Company (Sadara) in connection with Dow’s joint venture with Saudi Aramco for the development, financing and construction of a petrochemicals complex in Jubail (the Sadara Chemicals Project). The plastics and chemicals plant is one of the largest of its kind world-wide built on a green field basis. US $2 billion of the project financing debt for the US $20 billion Sadara project was raised through a sukuk (Islamic bond). That was the largest Saudi project finance sukuk ever issued and, significantly, was the first time a project bond had been issued in Saudi Arabia before the remainder of project debt had been arranged. The total project financing raised, including the sukuk, was approximately US $12.5 billion, the largest-ever project financing in the petrochemicals sector, as well as one of the largest multi-sourced financings in project finance history. The Sadara project financing was provided by a combination of eight export credit agencies (including a record US$ 5 billion single investment from US Exim), a large number of commercial banks, Islamic financial institutions, and the Public Investment Fund of Saudi Arabia.

The firm also represented the lenders in the second phase of the Rabigh Refining and Petrochemical Company Refinery and Petrochemical Complex, and has represented both the foreign shareholders and the sponsors in numerous major petrochemical projects including the award-winning Al Waha Petrochemical project and the Jubail Acrylates project.

Banking & Finance:

The banking and finance department advises arrangers, issuers and placement agents in relation to debt and equity capital markets, collective investment schemes, corporate trustees as well as general securities advice.

The firm’s work highlights include advising:

■ ACWA Power as it leads a consortium with Saudi Brothers Commercial Company (SBCC), on the financing of the US$ 700 million Rabigh-3 IWP which will generate 600,000 cubic metres a day and be one of the largest SWRO desalination projects in the world built in Saudi Arabia.

■ Marubeni Corporation and the National Energy Company (Taqa) on their successful bid for the planned Marjan cogeneration ISPP and Tanajib desalination plant. The Marjan ISPP is planned to have a power capacity of 700MW-900MW, with a steam capacity of 1,152-3,054 kilo pounds an hour, and a desalination component of 24,000 cubic metres a day – expandable to 34,000 cubic metres per day by 2030.

■ ACWA Power on the development of Saudi Arabia’s first renewable energy project under the Kingdom’s new National Renewable Energy Programme (NREP). Under a 25-year power purchase agreement (PPA) contract the 300MW photovoltaic (PV) solar plant will be developed in Sakaka in Al-Jouf province for a world record tariff of US$c2.34/ kilowatt hour. The special purpose vehicle, Sakaka Solar Energy Company, owned by ACWA Power and AlGihaz Holding, was formed to develop the project.

■ Marubeni & Marafiq on their bid for Saudi Water Partnership Company (SWPC)’s reverse osmosis desalination plant in Jubail, which will be a 600,000 cubic metres per day IWP.

■ The Marubeni and Marafiq Consortium in their bid for the Yanbu 4 IWP, which will be built in Ar Ray yis, 140km west of Madinah. The plant is to operate using reverse osmosis seawater desalination technology. Once built, the plant will have a daily drinking water capacity of 450,000m3.

Capital Markets:

The capital markets department provides ongoing advice to international and Saudi Arabian blue chip clients, with a focus on high-profile transactions. The firm has been the legal counsel to the National Commercial Bank in connection with several sukuk, one of which was the first Tier 1 sukuk to be issued by a Saudi Arabian bank.

The firm’s work highlights include advising:

■ Mobile Telecommunications Company Saudi Arabia (Zain) on its US$ 1.9 billion Saudi initial public offering which was oversubscribed at 283% with more than 8.53 million Saudis subscribing for shares by investing more than SAR 17.83 billion.

■ The Royal & Sun Alliance affiliate Al Alamiya Insurance Co. in connection with the initial public offering of 30% of its share capital as part of its licensing and incorporation pursuant to the Control of Cooperative Insurance Companies Regulation of 2003.

■ Ettihad Etisalat, on the initial public offering of 20% of its share capital under the new Capital Market Regulation, which was 51 times oversubscribed at a value of US$ 13.6 billion.

■ The National Commercial Bank on the initial public offering of a US$ 1.35 billion Tier II sukuk issuance. Acting as local counsel to NCB, the firm advised on the prospectus and all the Sukuk documents and transaction documents.

■ The National Commercial Bank on the early redemption of its SAR 5 billion Tier 2 Sukuk. The sukuk were offered through private placement on the 25th of February 2014, for an amount of SAR 5 billion, qualifying as Tier 2 subordinated debt in accordance with the Basel III framework.

■ International Company for Water and Power Projects on the debut bond for ACWA Power, which was issued in US dollars and listed on the Irish Stock Exchange. The bond is secured by cash flows and certain other securities from eight operating power generation and/or water desalination plants located in Saudi Arabia.

Corporate & Commercial:

Derayah LLPC has represented purchasers in domestic and cross-border transactions in different industries, including the banking, engineering, media, oil services and transport sectors.

The firm’s work highlights include:

■ Advising Hoffman La-Roche AG on the restructuring of its Saudi Arabian distribution operations, which included the licensing and setting up of a wholly foreign-owned trading company in Saudi Arabia, assisting in the transfer of its local workforce, and advising on regulatory matters, compliance and other issues required for the successful operation of the new business.

■ In connection with the privatization of Sago’s milling operations, representing a private sector client in the transfer to it of one of the largest milling sectors being privatized.