(Corrects to say hospital operator in fourth paragraph of story published yesterday.)

June 2 (Bloomberg) -- Khazanah Nasional Bhd., Malaysia's state investment company, may raise as much as S$500 million ($354 million) from the biggest sale of Islamic bonds, or sukuk, denominated in neighboring Singapore's currency.

 Khazanah is seeking to fund its takeover of Singapore-based parkway Holdings Ltd., said two people familiar with the matter, who asked not to be named because the discussions are private. CIMB Investment Bank Bhd. is among banks that may start the sale as soon as this month, one of the people said.

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