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Monday, 21 January 2008

TM completes largest securitisation deal of RM1b

KUALA LUMPUR: Telekom Malaysia Bhd has completed an Islamic sale and leaseback transaction involving the issuance of RM1 billion Islamic asset-backed Sukuk Ijarah by Menara ABS Bhd (MAB).
In a statement yesterday, TM said the transaction was completed with the sale of Menara TM, Menara Celcom, TM Cyberjaya Complex and Wisma TM (Taman Desa) to MAB for RM1 billion.
TM also entered into a 15-year lease agreement under the Ijarah principle. TM and its group of companies will continue to occupy the premises. Citibank Bhd was the principal adviser and sole lead arranger of the transaction.
MAB issued three classes of sukuk — Class A of RM345 million, Class B of RM155 million, while Class C totalled RM500 million.
TM group chief executive officer Datuk Seri Abdul Wahid Omar said: “One of our key objectives had been to achieve operating and capital efficiency and towards this end, monetising non-core assets such as the build-ings was an important strategy.”
“We are pleased that this transaction achieves not only our objectives in an effective and efficient manner, but we are also at the same time contributing to the development of the domestic Islamic capital markets by introducing such an innovative and landmark transaction.”
TM will use proceeds for capital management, funding investment, capital expenditure and working capital.
Citibank chief executive officer Sanjeev Nanavati said the exercise was the largest property securitisation deal to date in Malaysia and it achieved the objective of removing the property assets from the company’s balance sheet.
“The transaction also creates a significant and unique class of Islamic private debt securities that incorporate the features of both fixed income instrument as well as investment in a portfolio of high quality property assets,” he said.

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