Tuesday, Jan 25, 2011
KUALA LUMPUR (Dow Jones)--Malaysian state-owned water asset management company Pengurusan Aset Air Berhad, has tightened the price guidance for its MYR2.5 billion ($818.1 million) Islamic bonds, or sukuk, following strong demand for the offering, a person familiar with the matter told Dow Jones Newswires Tuesday.
"The (order book) is more than four times subscribed (as of 0700 GMT)," the person said, adding that "there is strong interest across all tenors."
Pengurusan Air is raising cash via three tranches: MYR1 billion each via 3-year and 5-year sukuk and MYR500 million via 10-year sukuk.
The indicative price guidance for the 3-year and 5-year sukuk is now 35 to 38 basis points above the respective 3-year and 5-year Malaysia Government Securities, compared with Monday's guidance of 37 to 42 basis points.
For the 10-year sukuk, the indicative yield will be 30 to 33 basis points above the 10-year MGS versus 38 to 43 basis points.
The Shariah compliant bond, which is based on the Islamic principle of commodity murabahah or sale and purchase transaction, is part of a MYR20 billion Islamic medium term note program announced in 2009. The bonds are guaranteed by the Malaysian government.
The bonds will be issued by Pengurusan Air SPV, a special-purpose vehicle set up as a wholly owned subsidiary of Pengurusan Aset Air to undertake the financing of the latter's acquisition of water assets and their accompanying liabilities in Malaysia. The SPV will also be responsible for the subsequent development of state water operators' infrastructure.
-By Elffie Chew, Dow Jones Newswires; (603) 2026 1233; elffie.chew@dowjones.com
(END) Dow Jones Newswires
25-01-11 0735GMT
