Malakoff unit Tanjung Bin Energy issues RM800m sukuk

PETALING JAYA: Malakoff Corp Bhd’s subsidiary, Tanjung Bin Energy Sdn Bhd, has issued RM800 million sukuk wakalah to raise funds to redeem an outstanding junior term loan for a turnkey contract with its parent company.
Malakoff’s board of directors said in a filing with Bursa Malaysia yesterday the aggregate amount of the loan from the contract established between the two parties on Feb 23, 2012 is RM1.29 billion.
“The Sukuk Wakalah is backed by an unconditional and irrevocable subordinated cash deficiency support from MCB (Malakoff) under which MCB shall agree to pay such sums expressed to be from time to time due and payable under the Sukuk Wakalah,” its directors said.
The sukuk is expected to have a positive impact on the net assets and gearing of the Malakoff group, but will not have any effects on the paid-up capital or shareholdings of substantial shareholders of Malakoff nor will it have a material impact on the consolidated earnings and consolidated earnings per share of Malakoff.
The sukuk's is expected to be classified as equity in the financial statements of Tanjung Bin Energy and Malakoff in accordance with the Malaysian Financial Reporting Standards.