Malaysia’s Tenaga Sells Islamic Bonds to Yield 3.8-4.9 Percent

Malaysia’s Tenaga Nasional Bhd. (TNB) sold 4.85 billion ringgit ($1.5 billion) of Islamic bonds maturing in five to 20 years at yields between 3.80 percent and 4.90 percent, according to the company’s chief executive officer.

The Islamic bonds, or sukuk, which pay returns from assets that comply with the religion’s ban on interest, were sold in 16 portions and were priced at the lower end of the initial yield guidance, Che Khalib Mohamad Noh said in an interview in Kuala Lumpur today.

“The sukuk drew about 23 billion ringgit in orders at the close of the offer on Oct. 25,” said Che Khalib. “We are extremely happy with the yields and the oversubscription rate.”

Proceeds from the sale by Malaysia’s biggest power producer will be used to finance the company’s coal-fired plant in the northern state of Perak, he said.

To contact the editor responsible for this story: Elffie Chew at echew16@bloomberg.net

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