Tuesday, Jan 15, 2008

The following is a press release from Telekom Malaysia:

Telekom Malaysia Berhad (TM) has successfully completed its Islamic Sale and Leaseback transaction that involved the issuance of RM1.0 billion of Islamic Asset Backed Sukuk Ijarah by Menara ABS Berhad (MAB).

Citibank Berhad is the Principal Adviser and Sole Lead Arranger for the transaction.

The transaction was completed with the sale and purchase of Menara TM, Menara Celcom, TM Cyberjaya Complex and Wisma TM (Taman Desa) to MAB for a total purchase consideration of RM1,000 million. TM has also entered into a 15-year lease agreement under the Ijarah principle. TM and its group of companies will continue to occupy the existing premises.

MAB issued 3 classes of Sukuk: Class A totaled RM345 million; Class B RM155 million, while Class C totaled RM500 million. Rating Agency Malaysia Bhd has rated Class A and B, with Class C being un-rated.

Dato' Sri Abdul Wahid Omar, Group CEO of TM said: "At TM, one of our key objectives had been to achieve operating and capital efficiency and towards this end, monetizing non-core assets such as the buildings was an important strategy. We are pleased that this transaction achieved not only our objectives in an effective and efficient manner, but we are also at the same time contributing to the development of the domestic Islamic capital markets by introducing such an innovative and landmark transaction."

TM intends to utilize the proceeds from the transaction for capital management, funding investment, capital expenditure and/or working capital. The transaction does not have any material effect on the share capital, net assets, earnings, gearing and dividend policy of TM.

Sanjeev Nanavati, Chief Executive Officer of Citibank Berhad said: "This current transaction is unique in a number of ways. It's the largest property securitization deal to date in Malaysia. It is based on Syariah principles, and achieves the objective of removing the property assets from the Company's balance sheet. The transaction also creates a significant and unique class of Islamic private debt securities that incorporates the features of both a fixed income instrument as well as an investment in a portfolio of high quality property assets."

(END) Dow Jones Newswires

January 15, 2008 06:26 ET (11:26 GMT)