Malaysia says $1.5b sukuk bond issue oversubscribed

Malaysia said on Thursday that it had successfully priced $1.5 billion worth of Islamic bonds, or sukuk, which was oversubscribed by 4.2 times with the bulk of the take-up from Asian accounts.

The sukuk was split between a $1 billion 10-year tranche and a $500 million 30-year tranche at a rate of 3.179 percent and 4.080 percent respectively, the ministry of finance said in a statement.

The deal attracted orders of over $6.3 billion from a combined investor base of over 195 accounts, the statement said. Asian accounts took two-thirds of the 10-year tranche and over half of the 30-year tranche.

This compares with a similar-sized deal in April of last year which attracted a $9 billion order book from 450 accounts.

It is the fifth global sukuk by Malaysia, with previous issuances in 2002, 2010, 2011 and 2015.

Structure

The sovereign tested a new sukuk format as well, using non-physical assets to underpin an agency-based transaction known as wakala, instead of the traditional use of physical assets.

The sukuk used vouchers representing entitlement to travel units and sharia-compliant shares, the statement said, without providing further details on those assets.

This could serve as a model for other sovereigns which have previously faced some difficulty in identifying and transferring tangible assets, such as buildings, for use in sukuk.

The deal was priced after a roadshow across global financial centres, including Kuala Lumpur, Hong Kong, Singapore, Abu Dhabi, Dubai, London and New York.

CIMB, HSBC, J.P. Morgan and Maybank acted as the joint bookrunners and joint lead managers for the offering.

Also read:

Indonesia raises $2.5b in its largest global ‘sukuk’ offering

Malaysia’s Axiata issues $500m sukuk for Ncell acquisition

Khazanah issues $750m dollar straight sukuk, to refinance Penerbangan Malaysia’s notes

Reuters

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.