TNB unit issues RM1.5b sustainability sukuk to fund hydroelectric power plant

KUALA LUMPUR (June 2): Tenaga Nasional Bhd (TNB) said its wholly-owned subsidiary TNB Power Generation Sdn Bhd has issued RM1.5 billion worth of sustainability Sukuk Wakalah to fund its Nenggiri Hydroelectric Power Plant project in Kelantan.

The sukuk was issued under its 30-year Sukuk Wakalah Programme of up to RM10 billion, TNB said in a bourse filing on Thursday (June 2).

The issuance was done in three tranches comprising RM150 million (10-year tenure), RM750 million (15 years) and RM600 million (20 years), which hold a periodic distribution rate of 4.70%, 5.05% and 5.20% per annum respectively.

“At the peak of the book-building exercise, the sustainability sukuk wakalah was oversubscribed by approximately 3.41 times, from the issue size of RM1.5 billion, with orders received amounting to an aggregate of RM5.1 million from over 30 accounts,” said TNB.

“TNB Power Generation Sukuk Framework has been accorded a “GOLD” rating by MARC Ratings Bhd as the independent external reviewer,” it added.

The utility giant said TNB Power Generation will play an important role in supporting its sustainability aspirations and commitment in mitigating climate change via the adoption of greener, cleaner and more efficient power generation technology.

It added that the subsidiary’s funding initiative demonstrates the latter’s commitment to support the group’s aspiration to achieve net-zero emissions by 2050, a move towards decarbonisation and renewable energy.

CIMB Investment Bank Bhd and Maybank Investment Bank Bhd are the joint principal advisers, joint lead arrangers and joint sustainability framework advisers for the Sukuk Wakalah Programme, as well as the joint lead managers for the first issuance of sukuk to be made under the programme.

Meanwhile, CIMB Islamic Bank Bhd and Maybank Islamic Bhd are the joint Shariah advisers for the programme.

Shares in TNB finished down three sen or 0.33% at RM8.97 on Thursday, giving the group a market capitalisation of RM51.36 billion.