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Proposed issuance of Sukuk Mudharabah by Manfaat Tetap Sdn Bhd, a Special Purpose Vehicle for Sistem Lingkaran-Lebuhraya Kajang Sdn Bhd

SUNWAY INFRASTRUCTURE BERHAD

Type

Announcement
SubjectProposed issuance of Sukuk Mudharabah by Manfaat Tetap Sdn Bhd, a Special Purpose Vehicle for Sistem Lingkaran-Lebuhraya Kajang Sdn Bhd

Contents :

Further to announcements made by Sunway Infrastructure Berhad (“SunInfra” or the “Company”) on 17 August 2007 and 25 October 2007, Affin Investment Bank Berhad (“Affin Investment”) on behalf of the Board of Directors of SunInfra wishes to announce that Affin Investment had, on 19 November 2007, submitted an application to the Securities Commission (“SC”) for the proposed issuance of Sukuk Mudharabah of RM752,236,660 (“Proposed Sukuk Mudharabah”), on behalf of Manfaat Tetap Sdn Bhd (“Manfaat Tetap” or “SPV”), a special purpose vehicle for Sistem Lingkaran-Lebuhraya Kajang Sdn Bhd (“SILK”).


The Proposed Sukuk Mudharabah to be issued by Manfaat Tetap is to part finance the full and final settlement of the existing Al-Bai’ Bithaman Ajil Islamic Debt Securities (“BaIDS”) issued by SILK, pursuant to the proposed refinancing scheme by Affin Investment (“Refinancing Proposal”) to refinance the debt obligations of SILK under the BaIDS. The BaIDS holders, vide an Extraordinary General Meeting Resolution dated 29 September 2007, have approved to extend the indulgence expiring on 30 November 2007 to 30 January 2008 in relation to the irrevocable instruction to the BaIDS trustee not to take any enforcement action against SILK and the security party for any breach of covenant under the existing BaIDS.

Based on the results of the votes collated by the BaIDS trustee vide its letter to Affin Investment dated 23 October 2007, approximately 65.87% of the existing BaIDS holders (% based on nominal value) have elected Option 1 under the Refinancing Proposal and the remaining existing BaIDS holders elected Option 2. Existing BaIDS holders that elected Option 1 would subscribe to the Sukuk Mudharabah amounting to approximately RM541.5 million after receiving part cash settlement. Existing BaIDS holders that elected Option 2 will be paid by cash with the settlement amount of approximately RM210.7 million after netting, amongst others, the cash from the existing designated accounts under the BaIDS.

The salient terms of the Proposed Sukuk Mudharabah, amongst others, include the following:

a) The tenure of the Proposed Sukuk Mudharabah shall be up to twenty-one (21) years from the date of issuance.

b) The Proposed Sukuk Mudharabah is expected to carry a minimum profit rate of 3.5% per annum commencing on the 1st anniversary from the date of issuance. A minimum principal payment of RM2.0 million per annum shall be paid commencing from the 3rd anniversary from the date of issuance. Under the Ijarah transaction of the Proposed Sukuk Mudharabah, any unpaid amount in respect of the minimum profit and principal payment shall be accrued in the first seven (7) years to ensure the low probability of default. However, non-payment of all accrued and current minimum profit and principal payment from the 8th anniversary from the date of issuance shall constitute an event of default under the Ijarah agreement.

c) Excess cash after meeting, among others, the operating/capital expenditure and minimum profit and principal payments, will be shared between the SPV (on behalf of investors) and SILK based on distribution scheme and profit sharing ratio. The distribution to SILK in relation to the above sharing will be capped at a pre-determined amount (“Ceiling Amount”). Sums exceeding the Ceiling Amount are payable to the investors which shall form part of the profit and principal payments.

d) Under the Proposed Sukuk Mudharabah, SPV and SILK are required to open and maintain the respective designated accounts to be operated by the Facility Agent and/or SILK. Prepayments are allowed vide agreed distribution scheme and profit sharing ratio and/or, refinancing through Islamic financing facility.

Upon the full and final settlement of the BaIDS pursuant to the issuance of the Proposed Sukuk Mudharabah, all the existing securities under the BaIDS will be discharged. The Proposed Sukuk Mudharabah is subject to the approval from SC.

None of the directors and/or substantial shareholders of SunInfra and/or persons connected with such directors or substantial shareholders have any interest, direct or indirect, in the Proposed Sukuk Mudharabah.

This announcement is dated 19 November 2007.



Announcement Info

Company NameSUNWAY INFRASTRUCTURE BERHAD  
Stock Name SUNINFR    
Date Announced19 Nov 2007  
CategoryGeneral Announcement
Reference NoMM-071119-68439




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