S P Setia launches RM4b sukuk programmes, unveils sustainability financing framework

• The sukuk programme will have a ceiling of RM3.5 billion and will encompass both senior Islamic medium term notes (senior sukuk wakalah) and subordinated perpetual Islamic notes (perpetual sukuk wakalah).

KUALA LUMPUR (April 29): Property developer S P Setia Bhd (KL:SPSETIA) announced on Tuesday it has lodged the necessary documents with the Securities Commission Malaysia to set up sukuk wakalah and Islamic commercial paper (ICP) programmes with a combined limit of up to RM4 billion. The funds raised will be used for the company's property development projects, working capital, repayment of borrowings, capital expenditure, and asset acquisitions.

The sukuk programme will have a ceiling of RM3.5 billion and will encompass both senior Islamic medium term notes (senior sukuk wakalah) and subordinated perpetual Islamic notes (perpetual sukuk wakalah). The ICP programme will allow for the issuance of ICP up to a nominal value of RM500 million, according to S P Setia's bourse filing on Tuesday.

S P Setia anticipates the first issuances under both programmes to happen within 90 business days from the lodgement date on Tuesday, or any extended period granted by the SC. The sukuk wakalah programme will have a perpetual tenure until and unless it is cancelled, while the ICP programme will have a lifespan of seven years. ICPs issued will have tenures ranging from one to 12 months.

The senior sukuk wakalah and perpetual sukuk wakalah under the programme have received preliminary ratings of AAIS and A+IS, respectively. The ICP programme has been rated MARC-1IS by MARC Ratings Bhd.

HSBC Amanah Malaysia Bhd and Maybank Investment Bank Bhd are the joint principal advisers for the sukuk programmes. The joint lead arrangers are CIMB Investment Bank Bhd, HSBC Amanah, and Maybank Investment Bank. HSBC Amanah and Maybank Islamic Bhd are the joint shariah advisers.

Separately, S P Setia also announced the establishment of its Sustainability Financing Framework, which aims to provide transparency and disclosure to investors and stakeholders and supports the issuance of financial instruments in green, social, and/or sustainability formats.

To ensure its framework aligns with relevant sustainability guidelines, S P Setia has appointed Sustainable Fitch to provide a second-party opinion.

“Under this framework, S P Setia will be able to raise instruments and financings which may include but are not limited to green or social sukuk, bonds, loans, and/or financing to finance green, social and/or sustainability projects that align with its sustainability priorities, and in alignment with industry best practices,” the company added.

Shares of S P Setia closed down by three sen or 2.65% at RM1.10 on Tuesday, resulting in a market capitalisation of RM5.65 billion.

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