Pengurusan Air Selangor (Air Selangor) has on the 19th September 2022 issued RM100 million (US$21.78 million)-worth of SRI Sukuk under a RM400 million (US$87.12 million) three-series issuance.
The RM400 million issuance consists of three facilities, with the two non-SRI issuances worth RM150 million (US$32.67 million) each. The SRI facility carries a tenor of 20 years and a coupon rate of 5.35%.
Issued under Air Selangor’s RM10 billion (US$2.18 billion) Sukuk Murabahah program, the SRI Sukuk facility is the smallest SRI issuance from Air Selangor, with the issuer floating its largest SRI tranche worth RM900 million (US$196.03 million) a mere three months prior in July 2022.
Stacking against Air Selangor’s inaugural SRI Sukuk issuance in late 2021, this SRI facility represents a RM330 million (US$71.88 million) downsizing.
The proceeds from the SRI facilities under the Sukuk Murabahah program, dubbed ‘Sukuk Kelestarian’, will be channeled toward sustainable water supply, sustainable water management, renewable energy and green building projects evaluated and selected by its internal Sukuk Kelestarian working group.
In a rating affirmation preceding the issuance of the Sukuk facility, RAM Ratings affirmed the ‘AAA/P1’ ratings on the program. According to the rating agency, which also provided the second opinion report on the program, the Sukuk Kelastarian will lead to a measurable positive impact on the environment and society, primarily through efficient and sustainable water management systems.
Following this facility, Air Selangor floated the fifth issuance under its Sukuk Murabahah program on the 19th April 2023 in a four-series issuance worth RM700 million (US$152.46 million).
Bank Islam is mandated as the principal advisor of the Sukuk program while Affin Hwang Investment Bank, Bank Islam, CIMB Investment Bank, Maybank Investment Bank and OCBC Al-Amin Bank are mandated as the lead managers of the program.
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Pengurusan Air Selangor SRI Sukuk T4 RM100 million (US$21.78 million)  19th September 2022 |
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| Summary of terms and conditions | |
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Issuer |
Pengurusan Air Selangor |
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Obligor |
RM100 million (US$21.78 million) |
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Purpose |
To finance eligible sustainable projects |
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Tenor |
20 years |
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Profit rate |
5.35% |
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Payment |
Semi-annual |
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Currency |
Malaysian ringgit |
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Maturity date |
19th September 2042 |
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Lead arranger(s) |
Bank Islam |
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Principal advisor(s) |
Bank Islam |
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Lead manager(s) |
Affin Hwang Investment Bank, Bank Islam, CIMB Investment Bank, Maybank Investment Bank, OCBC Al-Amin Bank |
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Governing law |
Malaysian law |
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Legal advisor(s)/council |
Shook Lin & Bok |
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Islamic structure |
Murabahah (via Tawarruq arrangement) |
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Underlying asset |
Shariah compliant commodities |
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Shariah advisor(s) |
Bank Islam |
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Rating |
‘AAA/P1’ by RAM Ratings |