KUALA LUMPUR (Jan 23): Top Glove Corp Bhd's wholly-owned subsidiary TG Excellence Bhd has lodged a RM3 billion perpetual sukuk programme with the Securities Commission Malaysia on Jan 22 to raise proceeds for refinancing and working capital purposes.

The sukuk, which is guided under the Shariah principle of Wakalah Bi-Al Istithmar, is guaranteed by Top Glove and has been assigned an AA-IS(cg) rating by the Malaysian Rating Corp Bhd (MARC), with the group's corporate credit rating being AA.

Both the group's credit rating and the rating assigned to its new sukuk programme carry a stable outlook.

Top Glove said the proceeds are intended to be used to refinance existing financing or debt obligations, repay intercompany borrowings and finance working capital requirements, investments, acquisition, capital expenditure or its general corporate purposes.

"All utilisation of proceeds raised under the Sukuk Wakalah shall be Shariah-compliant," said the group.

CIMB Investment Bank Bhd — the sukuk programme's shariah adviser — and Hong Leong Investment Bank Bhd are the joint principal advisers and joint lead arrangers for the programme.

In a separate statement, the rubber glove manufacturer said its AA credit rating from MARC is a testament to its position as a leading global glove manufacturer with an extensive product range and diversified geographical presence.

Its credit rating is supported by its strong management team, fairly strong debt coverage ratios and resilient rubber glove demand.

"The strong credit ratings assigned by the two rating agencies reflect their confidence in the solid business fundamentals of Top Glove and the company's commitment to strengthening its financial profile. We remain committed to undertaking our business operations sustainably and serving our customers with the utmost integrity," Top Glove executive chairman Tan Sri Dr Lim Wee Chai said.

Lim added that since listing in 2001, the group has demonstrated a revenue compound annual growth rate (CAGR) of 22% and profit after tax CAGR of 19%. The group's credit rating will allow for it to tap into the debt capital market in order to diversify its funding sources.

At 3.21pm, Top Glove shares fell 13 sen or 2.39% to RM5.30, for a market capitalisation of RM13.57 billion. Some 14.6 million of its shares were traded.