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Tuesday, June 18, 2024

Launch Partners

Case Study: Sunway Healthcare Treasury’s RM387 million (US$82.03 million) Sukuk

Sunway Healthcare Treasury (SHT) issued a RM387 million (US$82.03 million) Sukuk facility on the 30th August 2023. The seven-year Islamic medium-term note with a floating monthly rate was issued under SHT’s RM5 billion (US$1.06 billion) Sukuk program, which allows for the issuance of sustainability papers.

With Maybank Investment Bank as the lead arranger, the facility constitutes the first substantial issuance since the program was registered with the Securities Commission Malaysia on the 19th January last year. Prior to the August 2023 issuance, SHT debuted the program with a RM1 million (US$211,954) Sukuk facility in May 2023.

In early March last year, SHT received a ‘Gold’ impact assessment for its Sustainability Financing Framework from MARC Ratings.

SHT is a wholly-owned subsidiary of Sunway Healthcare Holdings (SHH). SHT, along with the Sunway Medical Center, acted as the guarantor for the Sukuk facility. Sunway Healthcare Group (SHG), an integrated private healthcare provider, is the immediate holding company of SHH.

The group operates a network of hospitals and ancillary services including ambulatory care centers, home healthcare and traditional and complementary medicine centers.

“SHG plans to expand across Malaysia with hospitals in Sunway Kota Damansara (Selangor), Iskandar Puteri (Johor), Ipoh (Perak), Kota Bahru (Kelantan) and Paya Terubong (Penang) as part of its aim to give more communities the access to high-quality healthcare,” RAM Ratings said in a statement.

The proceeds from the sustainability facility issued under the Sukuk Wakalah program will finance, among others, four greenfield projects across Malaysia.

SHG opened Sunway Medical Centre Velocity, its second tertiary hospital, in September 2019 and Sunway Medical Centre Penang in November 2022. SHG plans to acquire Sunway Medical Centre Velocity Phase 2 once its construction is completed.

According to its sustainable financing framework issued in February last year, the acquisition of Sunway Medical Centre Velocity Phase 2 was set to take place from last year onward.

Sunway Healthcare Treasury’s August 2023 Facility

RM387 million (US$82.03 million)


30th August 2023
Summary of terms and conditions
Issuer
Sunway Healthcare Treasury
Guarantor
Sunway Healthcare Holdings, Sunway Medical Centre
Size of issue
RM387 million (US$82.03 million)
Mode of issue
Private placement, bought deal
Purpose
– To finance Sunway Healthcare Holdings Group’s capital expenditure
– To refinance the group’s existing Islamic and conventional financings and borrowings, and
– To finance eligible SRI projects.
Tenor
Seven years
Profit rate
Floating rate
Payment
Monthly
Currency
Malaysian ringgit
Maturity date
30th August 2030
Lead arranger(s)
Maybank Investment Bank
Principal advisor(s)
Maybank Investment Bank
Governing law
Malaysian law
Legal advisor(s)/council
Adnan Sundra & Low
Islamic structure
Wakalah Bi Istithmar
Listing
No
Rating
Not rated
Shariah advisor(s)
Maybank Islamic Bank
Tradability
Yes

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