Axiata’s Indonesia unit plans RM1.4bil sukuk programme
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Axiata Group Bhd’s Indonesian unit, PT XL Axiata Tbk, plans to establish a five trillion rupiah (RM1.4bil) sukuk programme to optimise its balance sheet and improve its capital efficiency.
In a filing with Bursa Malaysia, Axiata said the sukuk programme would be established under a two-year shelf registration programme.
The first tranche or Shelf Sukuk Ijarah I XL Axiata Tranche I Year 2015 will see the issuance of up to 1.5 trillion rupiah based on the syariah principle of Ijarah, with the payment of Ujrah to be made quarterly in arrears.
The Tranche I sukuk will have four series, with Series A having a maturity of 370 calendar days, Series B (three years), Series C (five years) and Series D (seven years).
The net proceeds from Tranche I sukuk are to be utilised for working capital purposes to support PT XL Axiata’s business activity in terms of 2G radio frequency fee payment to the Government for the period of December 2015 to December 2016.
The Tranche I sukuk has been assigned a rating of AAA(idn) by PT Fitch Ratings Indonesia.
A major cellular provider in Indonesia, PT XL Axiata is 66.43% owned by Axiata through Axiata Investments (Indonesia) Sdn Bhd, and currently serves 62.9 million subscribers.
Questions & Answers
Q.What is the primary purpose of PT XL Axiata establishing this sukuk programme?
What is the primary purpose of PT XL Axiata establishing this sukuk programme?
The Indonesian unit of Axiata Group Bhd plans to establish the sukuk programme to optimise its balance sheet and improve its capital efficiency. This financial strategy aims to strengthen the company's overall financial health.
Q.How will the proceeds from the first tranche of the sukuk programme be used?
How will the proceeds from the first tranche of the sukuk programme be used?
The net proceeds from the Tranche I sukuk are designated for working capital purposes. Specifically, they will support PT XL Axiata's business activity by covering 2G radio frequency fee payments to the Indonesian Government from December 2015 to December 2016.
Q.What are the maturity periods for the different series within the first tranche of sukuk?
What are the maturity periods for the different series within the first tranche of sukuk?
The Tranche I sukuk has four series with varying maturities. Series A matures in 370 calendar days, Series B in three years, Series C in five years, and Series D in seven years, offering different investment durations.
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