KUALA LUMPUR (Jan 16): Permodalan Nasional Bhd has sold its first ever secured exchangeable sukuk raising US$300 million (RM1.2 billion) to invest in global assets.

The five-year paper will be exchangeable into shares of Gamuda Bhd (KL:GAMUDA). Proceeds from the offering have been earmarked for investment-grade global sukuk assets denominated in US dollars, said the state fund manager also known as PNB.

“We continue to undertake forward-looking and innovative initiatives to ensure our portfolio remains resilient and relevant in an increasingly complex investment landscape,” PNB president Datuk Abdul Rahman Ahmad said in a statement.

The issuance by PNB comes at a time when the share price of Gamuda, the biggest Malaysian construction firm by revenue, have hit new record highs.

The sukuk, issued through a Labuan incorporated special purpose vehicle Lunas Capital II Ltd, was priced at profit rate and yield of 0%, meaning that there would be no periodic cash payments to bondholders, and exchange premium of 10%.

“The offering of the exchangeable sukuk allows us to leverage the value of our domestic equity holdings, mitigate foreign exchange risk, and deliver greater diversification in line with our Strategic Asset Allocation under our LEAP 6 Strategic Plan,” said Abdul Rahman.

PNB, which manages assets worth over RM300 billion, also has substantial stakes in some of Malaysia’s largest listed companies, including Malayan Banking Bhd (KL:MAYBANK), SD Guthrie Bhd (KL:SDG), and Tenaga Nasional Bhd (KL:TENAGA).

CIMB and JPMorgan are the joint bookrunners and joint lead managers for the transaction.