23 October 2023
Kuala Lumpur – Pengurusan Air Selangor Sdn. Bhd. (Air Selangor) has recently successfully priced and issued a RM1.0 billion SRI Sukuk Kelestarian Air Selangor (SRI Sukuk) issuance across five (5) series ranging from seven (7) years to 25 years; the 6th tranche under its existing RM10.0 billion Sukuk Murabahah Programme. RAM Rating Services Berhad (RAM Ratings), had on 11 September 2023, affirmed the respective AAA/Stable and P1 ratings to the Sukuk Murabahah Programme.
The newly priced SRI Sukuk marks the largest offering by Air Selangor to date which received an overwhelming response from investors. Supported by strong orders garnered from the investors amounting to a total of RM3.6 billion, the offering was upsized from its initial issuance size of RM700 million to RM1.0 billion at book close, reflecting a strong oversubscription of 3.6 times.
Ir. Abas Abdullah, Acting Chief Executive Officer of Air Selangor said, “We are very pleased with the outcome and strong support received from the investors, as reflected in the remarkable oversubscription of 3.6 times. It is a testament to investors continuing confidence towards Air Selangor’s credit and the desire of investors to support our sustainability agenda to positively impact the environment and communities around us.”
Proceeds from the SRI Sukuk issuance will be utilised for eligible SRI projects that meet the criteria as set out in the Air Selangor Sustainable Development Sukuk Kelestarian Framework and/or the Sustainability Guidelines/Framework.
In addition to that, Air Selangor is also actively championing its key initiatives aimed at reducing Non-revenue Water (NRW) that is in alignment with the aspirations and targets set by Ministry of Natural Resources, Environment and Climate Change (NRECC). This includes the development of the Rasau Water Supply Scheme, refurbishment and maintenance of water assets, the replacement of aging pipelines just to name a few. Air Selangor has also established a target for carbon-neutral operations by 2040 for Scope 1 and Scope 2 emissions by leveraging energy efficiency and renewable energy projects. Eligible projects as per the guideline/ framework include, amongst others, sustainable water supply and sustainable water management projects, all of which are in line with Air Selangor’s efforts and commitment to the sustainability of water supply systems for our future generations.
Air Selangor is also seeing positive responses from the market in terms of its SRI Sukuk Kelestarian offering as it has yielded a strong demand across the investors’ universe, a clear reflection of investors’ confidence towards Air Selangor robust credit. The offering also saw a well-balanced allocation to financial institutions (36%), insurance companies (32%), asset managers (29%) and government agencies (4%).
Bank Islam Malaysia Berhad and Maybank Investment Bank Berhad are the Joint Lead Managers for this landmark offering by Air Selangor.