Khazanah Nasional secures US$1b in dual bond issuance

MALAYSIA’S sovereign wealth fund Khazanah Naisonal Bhd has raised a total of US$1 bil from a five-year US$500 mil sukuk wakalah, or Islamic bond, and a 10-year conventional bond offering, according to term sheet reviewed by Reuters late on Wednesday (Aug 28).

The sukuk was priced at a 4.484% yield, with the conventional bond at 4.759%, according to the sheet. The reoffer spreads were Treasuries plus 82 basis points and 92 basis points respectively, the sheet showed.

The sukuk was issued under Khazanah Global Sukuk Bhd’s US$5 bil multicurrency sukuk issuance programme while the conventional bond was under Khazanah Capital Ltd’s US$10 bil euro medium-term note programme, according to the sheet.

Proceeds from the sukuk will be used to fund shariah-compliant general investments and/or refinancing of borrowings of the company, the sheet showed.

Proceeds from the conventional bond will be used to fund general investments, refinancing of borrowings and working capital requirements relating to the principal business activities of the company, according to the sheet.

The issuance was expected to be rated A3 by Moody’s and A- by S&P, the sheet showed.

CIMB, Citigroup, DBS, JPMorgan , MUFG and OCBC were joint bookrunners and joint lead managers for the offering, the sheet showed.

Khazanah did not immediately respond to requests seeking comment on Thursday.

Khazanah in May last year raised a total of US$1.5 bil from a US$750 mil five-year sukuk bond and a US$750 mil 10-year senior unsecured fixed rate bond. The offerings were the first investment grade deal in Malaysia in two years. – Aug 29, 2024

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