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The Labuan International Financial Exchange Inc. (LFX), listed the second Exchangeable Sukuk listing by Khazanah Nasional Berhad (Khazanah). The Sukuk was issued via its special purpose vehicle (SPV), Cherating Capital Ltd, with an offering size of USD850 million. The Sukuk, due in 2012, is exchangeable into ordinary shares of PLUS Expressways Berhad (PLUS Expressways), the largest expressway concessionaire in Malaysia in terms of toll receipts.
The Sukuk has a maturity of five (5) years with a periodic payment of 2.0% per annum and were priced to achieve a yield to scheduled dissolution of 4.58%. It has also an exchange premium of 23% over RM3.2054, being the weighted average price of PLUS Expressways’ ordinary shares on 27 June 2007.
The listing of Khazanah’s latest Exchangeable Sukuk, marked LFX’s 43rd listing to date and brings LFX’s market capitalisation to USD15 billion. “It is very encouraging to note that there is a continuing trend from domestic Issuers to list Sukuks via the LFX,” said Dato’ Yusli Mohamed Yusoff, LFX Board Member and Chief Executive Officer of Bursa Malaysia Berhad.
To date, LFX has a range of Islamic financial instruments listed comprising nine (9) Sukuks, totaling USD3.95 billion. “The listing of the Exchangeable Sukuk also reflects LFX’s commitment and effort towards positioning itself as a premier offshore exchange for the listing of Islamic financial instruments,” added Dato’ Yusli.
He expects that this would serve as a precursor to the listing of other Shariah-compliant instruments on LFX and will further develop the Islamic financial market. “The success of the issuance and listing of the Sukuk is also a further testimony to Malaysia’s efforts towards being a global Islamic Financial hub,” said Dato’ Yusli.
The net proceeds raised from the Sukuk offering of approximately USD844 million will be used as additional working capital and for other general corporate purposes relating to Khazanah’s principal business activities.
The Listing Sponsor for the Exchangeable Sukuk is CIMB Bank (L) Limited. CIMB (L) Limited, Deutsche Bank AG, Labuan Branch and J.P. Morgan Malaysia Ltd. are the Joint Bookrunners and Joint Lead Managers for the Sukuk, while CIMB Islamic Syariah Committee acted as the Shariah adviser for the issuance.
