Malaysian telecoms group Axiata has priced a YN1bn (US$158m) Islamic bond (sukuk) at par.
The offering is the largest ever yuan-denominated sukuk and comes almost a year after an inaugural Yn500m (US$79m) Islamic bond issue by Khazanah Nasional, the…
Malaysian telecoms group Axiata has priced a YN1bn (US$158m) Islamic bond (sukuk) at par.
The offering is the largest ever yuan-denominated sukuk and comes almost a year after an inaugural Yn500m (US$79m) Islamic bond issue by Khazanah Nasional, the investment holding arm of the Malaysian government.
The sukuk has a two-year maturity and carries an annual coupon rate of 3.75%, payable semi-annually. The initial price guidance was at 4%. The sukuk attracted strong investor demand with a final book of more than Yn3.5bn, allowing it to upsize the initial targeted value from Y500m to Yn1bn, the company reportedly stated.
The bond is expected to be listed and quoted on Bursa Malaysia and on the Singapore stock exchange from 19 September.
The transaction is the first drawdown under Axiata’s US$1.5bn Islamic bond programme announced in mid-July. The company claimed previously to be the first Asian telecoms company to set up such a multi-currency sukuk programme.
It added that the programme “has an innovative structure which, among other things, allows airtime vouchers, presenting an entitlement to a specified number of airtime minutes on the mobile telecommunications network of subsidiaries of Axiata for on-net calls to be included as a trust asset.”
Proceeds will be used to reduce Axiata’s debt load and to provide it with further financial agility for the long term.
CIMB Bank, HSBC, and Merrill Lynch are joint lead arrangers for the sukuk programme.
Standard & Poor’s assigned a ‘BBB-’ rating to the bonds and Moody’s a ‘Baa2’.
This transaction comes a few weeks after Celcom Axiata, a subsidiary of Axiata, priced a RM5bn (US$1.6bn) sukuk issuance.
