Axiata Successfully Prices USD500 million Sukuk, with a Bid-to-Cover of 3.8 times
Kuala Lumpur, 13 November 2015 - Axiata Group Berhad (“Axiata”) has successfully priced its 5-year USD500.0 million sukuk (“Sukuk Issuance”) which will be issued via its wholly-owned Malaysian-incorporated special purpose vehicle, Axiata SPV2 Berhad. The Sukuk Issuance is the second issuance under Axiata’s multi-currency sukuk issuance programme with an aggregate nominal value of USD1.5 billion (or its equivalent in other currencies) (“Sukuk Programme”), established on 17 July 2012.
The Sukuk Issuance has been assigned ratings of Baa2 and BBB by Moody’s Investors Service Inc. and Standard & Poor’s Ratings Services respectively. The Sukuk Issuance, which will be listed on Bursa Malaysia (under the Exempt Regime) and the Singapore Exchange Securities Trading Limited, is structured based on the Shari'a principle of Wakala whereby the underlying assets are airtime vouchers, representing entitlement to a specified number of airtime minutes on the mobile telecommunications network of subsidiaries of Axiata for on-net calls.
The bookbuilding exercise commenced with an initial price guidance of U.S. Treasuries (“UST”) + 1.95%. Demand for the Sukuk issuance led to a revised guidance of UST + 1.75% - UST + 1.80% at Asian close/London mid with books in excess of USD2.0 billion. The Sukuk Issuance was finally priced at the tightest end of the price guidance, with a final book of over USD1.92 billion orders, representing a bid-to-cover ratio of close to 3.8 times, and a final yield of 3.466%. The issuance by Axiata attracted interest from a diverse group of Islamic as well as conventional investors, comprising asset management companies, financial institutions, insurance companies, and sovereign wealth funds, with participation from more than 170 accounts.
Commenting on the Sukuk Issuance, Axiata’s President & Group Chief Executive Officer, Dato’ Sri Jamaludin Ibrahim said, “Similar to the first series of RMB Sukuk issued in 2012 under the Sukuk Programme, we are pleased that the response for this Sukuk Issuance was positive. Despite the challenging business environment and volatility in the marketplace today, the strong participation from international investors is a testament to our solid fundamentals. Axiata is focused on our long term strategy to be a regional champion, and will continue to look towards opportunities in the capital markets to strengthen our capital base and support our aspirations.”
Axiata’s Group Chief Financial Officer, Chari TVT, added, “Axiata has always been at the forefront of innovative product solutions, whether in telecommunications or otherwise, and as a strong proponent of Islamic financing, it was only natural for us to tap the Sukuk Programme. Axiata’s Sukuk Issuance saw strong cross-border participation from a wide and diverse base of investors, with 58% from Asia, 22% Europe and 20% from Middle East.”
CIMB and Deutsche Bank AG, Singapore Branch are the Joint Arrangers and Dealers of the Sukuk Programme, as well as Joint Lead Managers and Bookrunners for the Sukuk Issuance. The transaction structure and documents for the Sukuk Issuance have been approved by CIMB Islamic Bank Berhad and Dr. Hussein Hamed Sayed Hassan, the Shari’a Adviser of Deutsche Bank AG, Singapore Branch.
Axiata is one of the largest Asian telecommunications companies. Axiata has controlling interests in mobile operators in Malaysia, Indonesia, Sri Lanka, Bangladesh and Cambodia with significant strategic stakes in India and Singapore.
The Group’s mobile subsidiaries and associates operate under the brand name ‘Celcom’ in Malaysia, ‘XL’ in Indonesia, ‘Dialog’ in Sri Lanka, ‘Robi’ in Bangladesh, ‘Smart’ in Cambodia, ‘Idea’ in India and ‘M1’ in Singapore.
The Group, including its subsidiaries and associates, has over 260 million mobile subscribers in Asia. The Group revenue for 2014 was RM18.7 billion. The Group provides employment to over 25,000 people across Asia. Axiata’s vision is to be a regional champion by 2015 by piecing together the best throughout the region in connectivity, technology and talent, uniting them towards a single goal: Advancing Asia.
The Group has expanded its portfolio of business which now includes a communications infrastructure solutions and services company called “edotco” and a digital services company, Axiata Digital Services.
Axiata was awarded the Frost & Sullivan 2009, 2010, 2011, 2012, 2013 and 2014 Asia Pacific ICT Award for Best Telecom Group and the Telecom Asia Best Regional Mobile Group 2010 and 2011 for its operations in multiple Asian markets.
This announcement does not constitute or form part of any offer to purchase, a solicitation of an offer to purchase, an offer to sell or a solicitation of an offer to sell, securities in the United States or any jurisdiction in which such offer or solicitation or sale would be unlawful.
The Sukuk Issuance has not been and will not be registered under the U.S. Securities Act of 1933, as amended (the "Securities Act") or the securities laws of any state of the United States or other jurisdiction and the Sukuk Issuance may not be offered or sold in the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and any applicable state or local securities law. No public offering of securities is being or will be made in the United States or any other jurisdiction. Neither this announcement nor any portion hereof may be sent or transmitted into the United States or any jurisdiction where it is unlawful to do so. Any failure to comply with these restrictions may result in a violation of the Securities Act or the applicable laws of other jurisdictions. A rating is not a recommendation to buy, sell or hold securities and may be subject to suspension, reduction or withdrawal at any time by the rating agency.