PETALING JAYA: Syarikat Kapasi Sdn Bhd, a wholly owned unit of ASIAN PAC HOLDINGS BHD, has proposed to issue RM200mil nominal value of up to 5-year guaranteed commercial papers or medium term notes to be guaranteed by Danajamin Nasional Bhd.
In a filing with Bursa Malaysia yesterday, Asian Pac said its principal adviser and lead arranger Affin Investment Bank Bhd would be submitting the proposed programme for the approval of the Securities Commission on behalf of Kapasi.
The proceeds of RM200mil to be raised is to be utilised by Kapasi to part finance its Kota Kinabalu Times Square 2 proposed development project on about 15.45 acres in Kota Kinabalu, the lease for which expires on Dec 31, 2076.
The proposed scheme comprises a retail mall of not less than 673,797 sq ft in net lettable area, 2,400 parking bays and not less than 41 exterior shop lots; and five blocks with not less than 498 serviced apartments and around 800 parking bays.
Asian Pac said the proposed programme was not expected to have any material effect on the group’s earnings for the financial year ending March 31, 2011.
Asian Pac managing director Datuk Mustapha Buang told StarBiz Danajamin’s guarantee had provided the company the opportunity to raise longer term borrowings at a reasonable cost within a shorter time.
“Despite being a mid-sized developer, we are now able to raise bonds for project financing. Bonds wrapped by Danajamin will automatically be upgraded to AAA rating, which gives investors an assurance of the quality of the paper.
“We expect to be charged a fixed coupon rate of around 4% to 5%, which is lower than bank interest rates of 7% to 8%,” he added.
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