MALAYSIA: Islamic Finance news has learnt that Celcom Transmission (Malaysia), a subsidiary of telecommunications firm Axiata Group, has sent out an information memorandum to investors for a RM5 billion (US$1.61 billion) Sukuk program.
A source close to the deal also confirmed an earlier news report that CIMB, HSBC and Maybank Investment Bank are managing the transaction. An issuance is expected by the end of this month.
Proceeds from the sale will be used to refinance existing debt, with the issuance already assigned a preliminary ‘AAA’ rating from local rating agency MARC, according to a report by Bloomberg.
Celcom Transmission, which is a unit of Celcom Axiata, Axiata’s Malaysian mobile telecommunications arm, is no stranger to the Sukuk space. In 2010, it set up a landmark RM4.2 billion (US$1.35 billion) Sukuk Ijarah deal to part-finance its acquisition of Celcom’s telecommunication network business.
News of the transaction follows Axiata’s announcement in July of its establishment of a US$1.5 billion multi-currency Sukuk program. Islamic Finance news earlier reported that the firm has no immediate requirement to issue papers from the program, which it will only tap as and when necessary. The Sukuk will be backed by airtime vouchers.
In a research report, OSK Research noted that: “The Sukuk program is in line with the group’s longer-term capital management roadmap to achieve a more optimal balance sheet. We believe Axiata is pre-empting its future funding needs by locking in an attractive Islamic facility to position for potential mergers and acquisitions as well as address its overall capital expenditure needs.
“At the same time, the group would be able to expand the portfolio of investors who are able to appreciate the growth potential across its regional assets. We are of the view that the setting up of a unique trust asset sweetens the deal, allowing the group to further monetize its network of assets across the region.”
Apart from in Malaysia, Axiata has controlling interests and strategic stakes in mobile operators in Bangladesh, Cambodia, India, Indonesia, Singapore, Sri Lanka and Thailand.
See: http://redmoney.newsweaver.co.uk/inuguq8q71qh38rwoni3wx?email=true&a=6&p=26557985&t=21804375
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