Malakoff earmarks proceeds for bond redemption

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KUALA LUMPUR (Apr 17): Malakoff Corp Bhd is allocating proceeds from its RM2.74 billion initial public offering (IPO) to redeem the electricity-generation entity's Islamic bond, chairman Tan Sri Syed Anwar Jamalullail said.

Malakoff's IPO involves the sale of 1.52 billion existing and new shares at an indicative price of RM1.80 per share. The exercise comprises 521.74 million existing shares under the offer for sale portion while the public issue involves one billion new shares.

Speaking to reporters at Malakoff's prospectus launch here today, Syed Anwar said proceeds from the public issue would be used to redeem a RM1.8 billion junior sukuk musharakah programme.

"Malakoff has a proven track record of development, acquisition, operation and maintenance in the power generation and water desalination industries. Our power generation assets have a balanced fuel mix of coal and multi-fuel and we also have renewable energy in our portfolio.

"We are well positioned to benefit from the continued growth in electricity and water demand in our target markets," said Syed Anwar.

Malakoff is expected to be listed on the Main Market of Bursa Malaysia this May 15.

MMC Corp Bhd has a 51% stake in Malakoff. After Malakoff's listing, MMC's interest in Malakoff will be diluted to 37.8%

MMC (fundamental: 1; valuation: 1.4) group managing director Datuk Seri Che Khalib Mohamad Noh said Malakoff was poised to grow on the increasing demand for electricity in the region.

As such, Che Khalib said Malakoff might explore business opportunities to address regional power needs.

(Note: The Edge Research's fundamental score reflects a company's profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)