KUALA LUMPUR (Sept 9): edotco Group has successfully priced and issued its maiden RM1.4 billion sukuk under its newly established Islamic medium-term notes programme of up to RM3 billion.

In a joint statement on Friday (Sept 9), the group said the sukuk issuance by its subsidiary edotco Malaysia Sdn Bhd represents the group’s first venture into the ringgit debt capital market for fundraising.

edotco Group is a regional integrated telecommunications infrastructure services company in Asia, operating and managing a portfolio of over 50,000 towers across Malaysia, Indonesia, Bangladesh, Cambodia, Sri Lanka, Pakistan, the Philippines, Myanmar and Laos.

The group was recently awarded the Frost & Sullivan 2021 Asia-Pacific Telecoms Tower Company of the Year Award for its exemplary business growth and performance.

Maybank Investment Bank Bhd (Maybank IB) and OCBC Al-Amin Bank Bhd are the joint principal advisers, lead arrangers and sustainability structuring advisers for the sukuk programme.

Maybank IB and OCBC Al-Amin also acted as joint lead managers for the sukuk issuance, together with RHB Investment Bank Bhd.

The sukuk issuance took place after a successful book-building exercise, which garnered robust interest from Malaysian fixed income investors.

With an order book that grew in excess of RM9 billion at its peak, it allowed edotco Malaysia to upsize the transaction from the initial size of RM1 billion to RM1.4 billion, representing a strong bid-to-cover ratio of 5.2 times.

The interest from investors also enabled the sukuk's overall yields to be tightened by 22 basis points across all tenures, and were finally priced at 3.93% per annum (three years), 4.27% (five years), 4.44% (seven years) and 4.54% (10 years).

edotco Group chief executive officer Mohamed Adlan Ahmad Tajudin said the maiden sukuk issuance is a significant step towards integrating sustainable and prudent capital management into the group's business strategy.

“This sukuk issuance represents a good opportunity for edotco Group to further diversify into alternative funding sources that match our cash flow profile,” he said.

Maybank IB CEO Datuk Fad’l Mohamed said the flexibility to issue sustainability sukuk will allow the company to tap into the growing pool of conscious capital globally.

Meanwhile, OCBC Bank (Malaysia) Bhd managing director, senior banker and head of investment banking Tan Ai Chin said edotco Group’s debut sukuk issuance via edotco Malaysia attracted a well-diversified pool of institutional investors comprising asset managers, insurance companies, financial institutions and government agencies.

She said the significant involvement of non-bank institutional investors is noteworthy, with a participation rate of close to 62% of the total issuance size.

“In total, 40 investors participated in the book-building exercise, 25% of which are Islamic investors.

“The overwhelming response from a well-diversified pool of investors is a testament to investors’ strong confidence in edotco Group’s business and financial resilience,” she said.