MISC Bhd, the world’s biggest owner of liquefied natural gas tankers, started marketing a RM1 billion (US$287 million) sale of Islamic bonds to raise funds for capital spending, said a person involved in the deal.

The Kuala Lumpur-based company plans to price RM400 million of one-year notes to yield between 2.57 per cent and 2.62 per cent, RM300 million of two-year bonds at between 3.08 per cent and 3.13 per cent, and RM300 million of three-year notes from 3.48 per cent to 3.53 per cent, said the person, who declined to be identified because the information isn’t public.

MISC, founded in 1968, is a unit of Petroliam Nasional Bhd, Malaysia’s state oil company, which last month raised US$4.5 billion selling Islamic and conventional bonds in the biggest dollar issue by an Asian company outside Japan this year.

Malaysia has taken the lead as the country of issuance for Islamic bonds, or sukuk, accounting for about 45 percent of the global total, Standard & Poor’s said on Sept 2.
CIMB Investment Bank Bhd and HSBC Bank Malaysia Bhd are managing MISC’s sale, the person said. MISC spokeswoman Fiona Clare Pereira isn’t available to comment because she’s traveling, her secretary said.

Sukuk are typically asset-based securities and pay a profit rate to investors instead of interest, which is banned by Muslim Shariah law. - Bloomberg