'Syarikat Prasarana planning to sell RM2b sukuk'

Published: 2009/09/08

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 company, which runs light rail services in and around Kuala Lumpur, 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, or Petronas, in selling sukuk to attract new investors. Sukuk sales plunged to US$13.9 billion (RM48.93 billion) last year amid the global credit freeze after soaring to a record US$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 Syariah law, which forbids interest.

Prasarana managing director Datuk Idrose Mohamed and chief financial officer Zooridah Haron weren't available for comment when Bloomberg News called yesterday. - Bloomberg