KUALA LUMPUR (Feb 21): TG Treasury Bhd, a wholly owned subsidiary of Top Glove Corporation Bhd (KL:TOPGLOV), announced the issuance of a five-year senior sukuk wakalah, with a value of RM800 million, on Thursday.

According to a statement, this issuance is part of the group’s preparation for the redemption of its outstanding perpetual bond, amounting to RM1.18 billion, which is due for redemption on its first call date, Feb 27.  

The RM800 million raised from the senior sukuk wakalah, together with RM380 million in internal cash from the group, will be allocated towards the redemption of the perpetual bond.

The senior sukuk wakalah is expected to result in a reduction of the group’s overall financing costs, Top Glove said. 

Following the redemption of the perpetual sukuk, Top Glove’s net gearing ratio will be at 0.12 times, the statement read.

At end-November 2024, Top Glove also had RM382.44 million in borrowings, on top of the RM1.18 billion perpetual bond. 

The issuance saw an oversubscription rate of approximately 3.32 times, resulting in an order book totalling RM2.65 billion, against a cash balance of RM377.96 million. 

“The issuance has attracted a positive response, reflecting the confidence of investors in our long-term strategy, and commitment to delivering value.

“We remain focused on leveraging this opportunity to support our growth and enhance resilience in an evolving market landscape,” said Top Glove founder and executive chairman Tan Sri Dr Lim Wee Chai.

CIMB Investment Bank Bhd and Hong Leong Investment Bank Bhd are the joint principal advisers, joint lead arrangers and joint lead managers, while CIMB Islamic Bank Bhd is the shariah adviser for the sukuk programme.

Shares of Top Glove traded two sen or 2.1% higher to 97.5 sen at noon market break on Friday, valuing the glovemaker at RM8.01 billion.