State-run Abu Dhabi National Energy Co (Taqa) aims to raise at least $1 billion from a two-tranche bond sale pricing on Monday, lead arrangers said, to help refinance debt maturing next year.

Taqa, which is 75 percent owned by the government of Abu Dhabi, last month said it would buy back a $1.5 billion bond maturing October 2012 and enlisted four banks to sell new debt.

Guidance for the long five-year tranche maturing 2017 is set at 350 basis points over 5-year US Treasuries and 412.5 bps over 10-year Treasuries for the portion maturing 2021.

The indicated guidance correlates to a yield of around 4.45 percent for the 2017 tranche and about 6.18 percent for the 2021 maturity.

Both tranches are indicated as benchmark-sized, meaning at least $500 million each. Two sources said the company was eyeing $1.5 billion from the deal.

Last week, Qatar printed a $5 billion bond in a three-tranche deal making it the biggest issue from the region this year.     

Like Qatar, Taqa is also going for a Reg S/144a deal which makes it open to institutional US investors.  Taqa's existing bonds fell after the guidance was released, as investors made room for the new issue. 

"The new ones look good, what remains to be seen is investor appetite," said one regional fixed income trader.

Taqa's $500 million 6.165 percent 2017 maturity  was yielding about 4.5 percent on Monday, up from 4.42 percent on Friday, according to Reuters data. The yield on its $1 billion 2016 maturity carrying a coupon of 5.875  percent rose to 3.944 percent on Monday from 3.682 percent on Friday. - Reuters