SYARIKAT Prasarana Negara Bhd, the Malaysian state-owned public transport operator, is selling RM2 billion of Islamic bonds to raise funds for projects, according to a person with knowledge of the plan.
The Kuala Lumpur-based company, which runs light-rail services in and around the capital city, hired CIMB Investment Bank Bhd and Maybank Investment Bank Bhd to help it sell 20-year notes, said the person, who declined to be identified because the details aren’t public.
Prasarana plans to sell as much as RM4 billion of Islamic bonds, known as sukuk, to raise funds for projects including rail line extensions, the person said in March.
Prasarana follows Petroliam Nasional Bhd, Malaysia’s state oil company, in selling sukuk to attract new investors. Sukuk sales plunged to $13.9 billion last year amid the global credit freeze after soaring to a record $31 billion in 2007 as oil earnings boosted Arab wealth, according to data compiled by Bloomberg.
Sukuk are asset-based securities that pay a profit distribution to investors to comply with Muslim Shariah law, which forbids interest. Prasarana Managing Director Idrose Mohamed and Chief Financial Officer Zooridah Haron weren’t available for comment when Bloomberg News called today. - Bloomberg
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