KUALA LUMPUR (May 8): Mr DIY Group (M) Bhd (KL:MRDIY) on Friday said it has raised RM540 million from its first ever bond issuance since the home improvement retailer’s listing six years ago.

Proceeds from the papers, comprising Islamic medium-term notes and Islamic commercial papers, have been earmarked to refinance existing borrowings, support working capital requirements, fund capital expenditure and for general corporate purposes, Mr DIY said in a statement.

“This strategic move facilitates our transition towards a shariah-compliant funding structure, further strengthens our capital structure and provides us with greater financial flexibility to support our next phase of growth,” said Mr DIY CEO Adrian Ong.

The Islamic bonds were issued under its RM5 billion sukuk wakalah programme. At the initial price guidance, the Islamic medium-term notes saw orders exceeding the amount on offer by 6.5 times.

The notes were priced at 3.83% for the seven-year issue and 3.92% for the 10-year tranche, achieving final oversubscription of about 5.6 times.

The deal attracted a diverse group of investors comprising statutory bodies, pension funds, asset managers, takaful and insurance companies and financial institutions.

“We are encouraged by the exceptionally strong reception to our debut sukuk issuance as evidenced by the lower yield achieved compared to our existing borrowings,” Ong noted.

CIMB Investment Bank, Hong Leong Investment Bank and Maybank Investment Bank are the joint lead managers for this first issuance of the sukuk wakalah.