Saudi petrochemicals producer Sipchem is arranging meetings this month with potential investors to issue a sukuk for which Saudi banks Riyad Capital and NCB Capital have been appointed as managers. Sipchem says the number and value of the Sharia-compliant bonds to be offered “will be determined based on market conditions.”

Although the company has not revealed what it intends to spend the raised money on, Sipchem CEO Ahmad al-Ohali says the company is “constantly seeking...