Abu Dhabi state-owned International Petroleum Investment Company (IPIC) has selected the nine banks which lent to its subsidiary for its own euro-denominated bond issue, sources aware of the matter said.

However, the bond is unlikely to be issued any time soon due to IPIC's deepening row with troubled Malaysian state investment fund 1MDB. IPIC offered guarantees against its former partner's debt and provided it with cash in exchange for assets, but both are now involved in a spat over the obligations.

"Having answers to all the questions stemming from 1MDB will be important for securing investor support," said one of the sources, who declined to be named.
IPIC declined to comment.

Sources said IPIC has selected the lenders which provided Aabar Investments with a 3.6 billion euro loan in March - Bank of America-Merrill Lynch, BNP Paribas, HSBC, Intesa Sanpaolo, JP Morgan, National Bank of Abu Dhabi, Natixis, Societe Generale and Sumitomo Mitsui Banking Corporation.

Last month sources said a euro bond would be used to refinance existing IPIC debt.
IPIC has a 1.25 billion euro bond maturing on May 14, according to Thomson Reuters data. The fund will likely have to repay that debt using another source, such as existing cash reserves, and then raise the new bond at a later date.

Abu Dhabi state entities are lining up to sell bonds after the government's blockbuster $5 billion deal last month -- its first international debt sale in seven years which came after a lull in issuance from the emirate.

Fellow state-owned investment fund Mubadala sold a $500 million seven-year bond on Monday, while banks were due to respond last Sunday to Abu Dhabi National Energy Company (Taqa), which had invited them to pitch for arranger roles on a potential bond offering.-Reuters