Saudi Arabian retailer Fawaz Abdulaziz Alhokair Co plans to issue a debut riyal-denominated sukuk and is close to signing a 1 billion riyal ($266.6 million) loan, it said on Tuesday, to help fund expansion.

Alhokair, the Saudi Arabian retailer which franchises brands such as Zara and Marks and Spencer in the kingdom, will begin meeting local investors on Tuesday ahead of a potential issuing of the Islamic bond, a bourse filing said.

Samba Financial Group's investment banking arm will arrange the transaction, although no value or tenor of the sukuk was given in the statement.

The company was also close to signing an agreement with a group of banks for a loan worth 1 billion riyals, Alhokair said in a separate stock market statement.

The loan would be used to repay most of its existing loans and also to finance the company's expansion.

To cover the time between the loan and the sukuk being completed, Alhokair had signed a 315 million riyal bridging loan with Samba, the statement said.

Alhokair operates across 20 markets, predominantly in the Middle East and Commonwealth of Independent States, and has been expanding both on its own and through acquisitions - including the purchase of Spanish clothing brand Blanco earlier this year.

Alhokair was planning to open 404 stores globally in the next financial year, of which half would be in Saudi Arabia, a company official told Reuters in March.

Saudi Arabia's retail market is highly regarded by investors and companies, given its favourable demographics - about 60 percent of the population is under 30 - and its growing per capita income.