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Malakoff Signs RM6.5 Billion Financing Agreements

28 February 2012

Islamic Sukuk, US Dollar and RM Term Loans and RM Equity Bridge Loans To Finance New 1,000 MW Power Plant

Kuala Lumpur, 29 February 2012 – Malakoff Corporation Berhad via its wholly-owned subsidiary, Tanjung Bin Energy Issuer Berhad, entered into financing agreements totalling RM6.5 billion for the development of the new 1,000 MW supercritical coal-fired power plant adjacent to Malakoff’s existing Tanjung Bin power plant.

The new power plant in Tanjung Bin is to be financed by a combination of senior and junior debt facilities, comprising of Islamic bonds and loans denominated in Malaysian Ringgit and US Dollars.

Speaking at the signing ceremony, Zainal Abidin Jalil, Chief Executive Officer of Malakoff said, “This signing ceremony is a significant milestone for Malakoff Corporation Berhad as it marks the commencement of Tanjung Bin’s expansion. We are very excited about this project as it will strengthen Malakoff’s position as the leading independent power producer not only in Malaysia, but also within the ASEAN region.”

“We are indeed very pleased that this project has attracted a broad range of both domestic and foreign financial institutions for this venture, demonstrating the financial community’s confidence in Malakoff. This also marks the first participation of international lenders for a power project financing in Malaysia ,” he added.

The Senior debt facilities for the financing include the issuance of RM 3.29 billion serially-amortising senior secured Islamic bond (Sukuk), a USD 400 million term loan, and RM 700 million term loan. Meanwhile, the Junior facility comprises equity loans of RM 1.3 billion.

Recently, Rating Agency of Malaysia assigned a preliminary AA3 rating for Tanjung Bin Energy Issuer Berhad’s Sukuk, which reflects the project’s high reliability and creditworthiness.

Zainal said, “We are grateful for the trust that the Government has in Malakoff’s capabilities. We are also extremely appreciative of our partnership with our business associates and suppliers.”

The new 1,000 MW power plant project was awarded to Malakoff in June last year following a competitive bidding process, overseen by the Energy Commission of Malaysia.

The construction of this new project is expected to take four years, after which Malakoff will be making the generating capacity available to the off taker, Tenaga Nasional Berhad, under a 25-year Power Purchase Agreement. Meanwhile, the operation and maintenance for the new power plant will be provided by Teknik Janakuasa Sdn Bhd, a wholly-owned subsidiary of Malakoff, under a long-term O&M agreement.

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