by NUR HAZIQAH A MALEK/ pic by RAZAK GHAZALI

EXSIM Group has appointed United Overseas Bank (M) Bhd (UOB Malaysia) as the principal advisor, lead arranger and lead manager of its RM3 billion sukuk programmes, while Danajamin Nasional Bhd will provide guarantees and liquidity facilities for tranche one.

Group MD Lim Aik Hoe said the programmes will help the company achieve its next level of growth and provide the company with liquidity for future projects.

“With the support of UOB Malaysia and our partners, this innovative structure will enable EXSIM to deliver more value to its stakeholders and help us finance the capital expenditure and working capital requirements of our new and existing commercial real estate development projects,” he said.

The programmes mark the group’s second Islamic debt capital market transaction arranged by UOB Malaysia, whereby its first sukuk programme through the bank was in January 2019 to monetise its residential real estate earnings.

The company’s head of corporate communications Michelle Siew said the programmes, namely the RM2 billion Islamic Medium-term Note (IMTN) programme and a RM1 billion Islamic Commercial Papers (ICP) programme will be used for refinancing, new land purchase and finance working capital requirements.

“The two financially innovative sukuk programmes, which are structured by NewParadigm Capital Markets Sdn Bhd, will be established through a special-purpose vehicle, EXSIM Ventures Bhd,” she said.

The IMTN programme is the first sukuk structure in Malaysia to monetise the future sales earnings of a commercial real estate development project, whereby each tranche will be secured against a specific project.

The first tranche is backed by the executed sales and purchase agreements of Scarletz Suites, which is EXSIM’s second commercial property development in the Kuala Lumpur City Centre and carries a credit rating of AA3/stable assigned by RAM Rating Services Bhd.

According to Lim, all 504 units at the development project have been taken up and will be delivered by the third quarter of 2021.

Meanwhile, the ICP programme is unrated, and will have its first tranche guaranteed by Malaysian financial guarantee insurer, Danajamin, and will be fully underwritten by UOB Malaysia.

To date, the company has launched 21 developments with a total gross development value of RM8 billion and another RM18 billion in the pipeline.

The guarantor, Danajamin CEO Mohamed Nazri Omar said the developer is recognised for timely developments and demonstrating take-up rates of over 90%.

“It is our mandate to support growth of mid-size companies in a sustainable manner,” he said.

UOB Malaysia wholesale banking country head and MD Ng Wei Wei said the bank has lead-arranged a number of significant Islamic debt transactions via its investment banking platform.

“Providing our clients with a comprehensive range of banking solutions, through both our conventional and Islamic solutions, is integral to building long-term relationships with our clients and meeting their differentiated needs,” she said.

Meanwhile, the bank recently signed an agreement with Ditrolic Sdn Bhd to provide installation and management services of solar power systems for the bank’s corporate clients.

The collaboration marks the fourth tie-up between UOB Malaysia and a leading solar energy provider under its U-Solar programme, the continent’s first solar industry ecosystem connecting businesses and consumers.