KUALA LUMPUR: The RHB Banking Group has structured and lead arranged a RM745mil sukuk programme for Projek Lintasan Shah Alam Sdn Bhd (PLSA) but pricing of the papers has yet to be determined given the uncertainties in the capital markets.
RHB Islamic Bank vice-president, Islamic Investment Banking Group, Razali Daud said the bank could not provide details as yet, owing mainly to the volatile market conditions.
“We will decide on the (pricing) very, very soon and we will try our best to strike a balance between the ability of the issuers and expectations of investors.
“During good times, the appetite for investments is very robust but, in times like these, most investors adopt a wait-and-see attitude,” he said at the signing ceremony for the sukuk programme yesterday.
He said the papers would be placed out to institutional investors.
RHB Islamic Bank and RHB Investment Bank are joint principal advisers and joint lead arrangers for this exercise.
It aims to raise funds for the construction and development of the proposed RM750mil Lebuhraya Kemuning-Shah Alam (LKSA) highway of which PLSA is the concessionaire.
The first tranche of the bonds, Razali added, would be rolled out before the end of the year.
Under the sukuk, which is Gulf Cooperation Council-compliant, PLSA will issue sukuk Ijarah of up to RM330mil and sukuk Mudharabah of up to RM415mil.
RAM Rating Services Bhd has assigned long-term rating of A1 to the sukuk Ijarah and long-term rating of A3 to the sukuk Mudharabah.
An A rating, according to RAM’s website, indicates adequate safety for timely payment of interest and principal in addition to being more susceptible to changes in circumstances and economic conditions than debts in higher-rated categories.
The subscript 1 indicates that the issue ranks at the higher end of its generic rating category; the subscript 2 indicates a mid-ranking; and the subscript 3 indicates that the issue ranks at the lower end of its generic rating category.
PLSA has been awarded a 40-year concession to undertake the design, construction, management, operation and maintanence of the 14.7km highway.
Projek Lintasan Kota Holdings Sdn Bhd group chief executive Zainudin A. Kadir said the highway was expected to be fully completed by December 2009, with a “partial opening” slated for the end of this year. (PLSA is a joint venture between Projek Lintasan Kota Holdings and Island & Peninsular Sdn Bhd.)
