Labuan International Financial Exchange Market Cap Reaches US$10 Billion With Khazanah's Notes

Market capitalisation at the Labuan International Financial Exchange Inc (LFX) increased to US$10.13 billion (RM38.49 billion) with the primary listing of US$414.5 million exchangeable notes issued by Labuan-based Feringghi Capital Limited, a wholly owned subsidiary of Khazanah Nasional Berhad, the Malaysian government investment holding arm.

LFX Board Chairman and Chief Executive Officer of Bursa Malaysia Berhad, Yusli Mohamed Yusoff said that this is the largest equity-linked security issued by any entity in Malaysia in recent times, and indeed on LFX.

"Khazanah's primary listing on LFX reflects the Malaysian Government's support of the offshore exchange. This augurs well as LFX is into its second phase, seeking more Malaysian corporations to make primary listings on the exchange."

The issue is a 5 year zero-coupon guaranteed exchangeable notes (the “Notes”) . The Notes have a maturity of 5 years, with an investor put option at the end of the second year. The Notes are exchangeable into ordinary shares of RM0.25 each of PLUS Expressways Berhad (PLUS) currently held by Khazanah. PLUS owns and manages some of Malaysia’s highways and is listed on Bursa Malaysia.

Proceeds from the Notes issue will be used as additional working capital and for other corporate purposes relating to Khazanah’s principal business activities.

The listing sponsor for the issue is CIMB (L) Limited. Licensed by the LFX, a listing sponsor is primarily responsible to arrange for the listing of instruments on the LFX and for any subsequent post listing obligations arising.