Lekas to raise RM1.75b for toll highway project

  • Business
  • Thursday, 26 Apr 2007

SUBANG JAYA: Lebuhraya Kajang-Seremban Sdn Bhd (Lekas), a 50% associate company of IJM Corp Bhd, plans to raise RM1.75bil by selling Islamic bonds and loan stocks to fund the construction of a 44.3km toll highway that will connect Kajang, Semenyih and Seremban. 

AmInvestment Bank Bhd, the lead arranger for the financing facilities, has already started a roadshow to meet potential investors for the RM1.42bil Islamic bonds in the form of Sukuk Istisna papers. 

The Sukuk Istisna papers have maturities ranging from seven to 15 years. 

“We hope to be in the market in two weeks,'' managing director Kok Tuck Cheong said at the signing ceremony to arrange the funding for Lekas. 

Bank Muamalat Malaysia Bhd is the co-arranger of the programme. 

From left: Kok Tuck Cheong, Datuk Krishnan Tan and Malaysia Trustees Bhd director Chris Lee Wai Kit after the signing

Lekas is the special-purpose vehicle set up to undertake concession of the Kajang-Seremban Highway that comes with the right to collect toll for 32½ years. 

Kaseh Lebuhraya Sdn Bhd, the original concessionaire of the highway, owns the remaining stake in Lekas. 

Work on the highway was already in progress and expected to be completed by October 2009, Lekas director Datuk Krishnan Tan, who is also chief executive officer and managing director of IJM Corp, said at the event. 

IJM Construction Sdn Bhd, a unit of IJM Corp, was appointed the main contractor for the project. 

The construction cost is estimated at RM900mil, to be part-financed by the RM785mil proceeds from senior Istisna bonds sale.  

The other portion of RM633mil, arising from the junior Istisna bonds issue, will be used to repay older debts incurred by the highway project.  

The two bond issues were accorded AA3 and A1 ratings respectively by Rating Agency Malaysia Bhd. 

Lekas will also issue RM240mil in convertible loan stocks and RM50mil redeemable loan stocks. The concessionaire has also secured a RM40mil joint revolving credit facility and bank guarantee under the financing programme.  

 IJM :  [Stock Watch]  [NewsIJM-CA :  [Stock Watch]

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