Ekovest Berhad’s wholly owned subsidiary, Lebuhraya DUKE Fasa 3 Sdn Bhd is set to issue Malaysia’s largest Ringgit-denominated greenfield toll-road project financing for its Setiawangsa-Pantai Expressway (formerly known as DUKE Phase-3) project.
Speaking at the signing ceremony for the Sukuk Wakalah, Datuk Seri Lim Keng Cheng, Managing Director of Ekovest Berhad, said “Securing the financing for the DUKE Phase-3 was the last piece of the puzzle to ensure that the project is implemented immediately. This RM3.9 billion project is the largest project that Ekovest Group will undertake to date and we thank the Government for their confidence in believing that we can deliver. As part of the financing structure, Ekovest Berhad will inject RM850 million as equity into the project and this shows our confidence and commitment to deliver the best road infrastructure network in Kuala Lumpur”.
The Sukuk of RM3.64 billion in nominal value is based on the Shariah principle of Wakalah Bi Al-Istithmar. An agreement was inked between Lebuhraya DUKE Fasa 3 Sdn Bhd as the concession holder of the DUKE Phase-3, AmInvestment Bank Berhad as the Principal Adviser/Lead Arranger, and the Joint Lead Managers/Joint Bookrunners comprising AmInvestment Bank Berhad, CIMB Investment Bank Berhad, Maybank Investment Bank Berhad and RHB Investment Bank Berhad.
Present to witness at the signing ceremony was Finance Minister II, Y.B Datuk Johari bin Abdul Ghani, together with Ekovest Berhad Executive Chairman Tan Sri Dato’ Lim Kang Hoo.
The Sukuk Wakalah has been assigned a rating of AA-IS by Malaysian Rating Corporation Berhad (MARC) and the proceeds will be utilised for the design, construction, maintenance, operation and management of the 32km Setiawangsa-Pantai Expressway (formerly known as DUKE Phase-3).
One of the highlights of this Sukuk Issuance is that it is one of the largest standalone Ringgit-denominated AA- issuance YTD2016. Furthermore, the size of the issuance is significant as it is the largest Ringgit-denominated greenfield toll-road project financing (in nominal value) to date.
To recap, the Concession Agreement for the Setiawangsa-Pantai Expressway (formerly known as DUKE Phase-3) was signed on 11 January 2016 between Lebuhraya DUKE Fasa 3 Sdn Bhd and the Ministry of Works on behalf of the Malaysian Government. The proposal for the Setiawangsa-Pantai Expressway (formerly known as DUKE Phase-3) has been in the works since early 2010 and is part of Ekovest Group’s long term transportation master plan.
The 32.1 kilometre highway will link MRR2 at Universiti Tunku Abdul Rahman (UTAR) to Federal Highway/Kerinchi Link. The Setiawangsa-Pantai Expressway (formerly known as DUKE Phase-3) will provide connectivity to areas and link existing highways such as the MRR2, Wangsa Maju, Duta-Ulu Kelang Expressway (DUKE), Ampang Kuala Lumpur Elevated Highway (AKLEH), Maju Expressway (MEX), Kampung Pandan & City Centre, Bandar Malaysia, New Pantai Expressway (NPE), Old Klang Road, Jalan Syed Putra, Federal Highway and Kerinchi Link. Its strategically planned interchanges will be able to serve a multitude of matured catchments area along its corridor and with existing roads such as Jalan Tun Razak and MRR2 reaching its full capacity, the Setiawangsa-Pantai Expressway (formerly known as DUKE Phase-3) will provide a viable alternative and facilitate a faster and direct access to and from the north-eastern area of Kuala Lumpur to the southern area of Kuala Lumpur. The Setiawangsa-Pantai Expressway (formerly known as DUKE Phase-3) is expected to be completed and in operation in 2020.