Overwhelming demand from investors led to an oversubscription rate of more than 10 times from the initial target issue size of RM500.0 million, resulting in an upsized transaction to fulfil demand
SEPANG- Malaysia Airports Holdings Berhad (Malaysia Airports) announced today that it has successfully priced and issued its second Senior Sukuk Wakalah of RM800.0 million pursuant to its Sukuk Wakalah Programme of RM5.0 billion in nominal value. The dual-tranche offering comprises a 3-year RM500.0 million Sukuk and a 5-year RM300.0 million Sukuk.
At the peak of the book-building exercise, the Senior Sukuk Wakalah was oversubscribed by 10 times from the initial issue size of RM500 million. Due to the overwhelming demand from investors and oversubscription rate, the Senior Sukuk Wakalah was upsized to RM800.0 million, with a very strong book-to-cover ratio of 3.5 times at closing.
The strong order book also allowed Malaysia Airports to tighten its offering yield to a final profit rate of 3.79% p.a. and 3.98% p.a., which is lower than the existing Malaysia Airports Sukuk yields trading in the market. The offering was well received by a diversified group of investors and predominantly favoured by asset managers and financial institutions.
Commenting on the successful issuance of the Senior Sukuk Wakalah, Dato’ Iskandar Mizal Mahmood, Managing Director of Malaysia Airports said, “The success of this latest issuance is a testament of investors’ confidence in our recovery and growth trajectory on the back of the improving economy as well as international travel. Malaysia Airports is well positioned to capitalise on the reopening of borders, and our strong fundamentals will help to advance our business in the new era of travel.”
The Senior Sukuk Wakalah under the Sukuk Wakalah Programme has been assigned an initial rating of AAA with a stable outlook by RAM Rating Services Berhad. The favourable rating reflects Malaysia Airports’ solid business profile, track record of prudent financial management and the strategic importance of Malaysia Airports’ business operations to the Government of Malaysia in view of its role as the sole operator of all 39 government-owned airports in Malaysia.
Proceeds raised from the Sukuk Wakalah shall be utilised by Malaysia Airports Group to refinance its maturing borrowings at a lower funding rate.
HSBC Amanah Malaysia Berhad and Maybank Investment Bank Berhad are the Joint Principal Advisers and Joint Lead Arrangers for the Sukuk Wakalah Programme, whereas HSBC Amanah Malaysia Berhad, Maybank Investment Bank Berhad and RHB Investment Bank Berhad are the Joint Lead Managers for the Sukuk Wakalah Programme.