Nodding Donkey

Largest Islamic facility in Malaysia’s history

7 April 2015

Watson, Farley & Williams Asia Practice LLP said today that the USD2.3 billion equivalent Islamic facility to SapuraKencana Petroleum Berhad (“SapuraKencana”) represents a milestone transaction as the largest syndicated Islamic facility in the Malaysian market to date.

WFWAP advised SapuraKencana, Malaysia’s largest oil and gas services firm by market capitalisation, on the transaction to refinance a portion of its existing conventional multi-currency facility borrowings following a USD5.5 billion financing in 2014 to acquire new oil and gas assets and refinance existing facilities; another landmark transaction for the Malaysian market. The WFWAP team advising SapuraKencana was led by partner Andrew Nimmo and senior associate Shawn Er.

The Islamic facility was structured as a multi-currency commodity murabaha facility and was used to refinance one tranche of the 2014 multi-currency facility, increasing the level of shariah-compliant financing taken out by SapuraKencana Petroleum Berhad and making the company eligible to return to the Securities Commission’s List of Shariah Compliant Securities.

Allen & Overy advised Maybank Investment Bank as coordinator of a consortium of 11 local, regional and international banks acting as mandated lead arrangers. The team was led by Allen & Overy’s Singapore-based partner Jason Humphreys, with London-based European head of Islamic finance Atif Hanif advising on the Islamic financing aspects.

Andrew Nimmo of WFWAP commented: “WFWAP is proud to have been involved in this landmark deal for the Malaysian Islamic financing market which marks another innovative funding solution for SapuraKencana, building on the success of the RM16.5 billion (USD 5.5 billion) facility last year on which WFWAP also advised the company. The appetite for this financing demonstrates the strong financial support for the company and for the sector, notwithstanding the challenge to the market presented by the recent oil price movements, and we expect to see a continuation.”