Friday, Aug 02, 2002
Malaysian Rating Corporation Berhad (MARC) has assigned Islamic corporate debt ratings of MARC-1ID/AAAID (Islamic Debt) to Putrajaya Holdings Sdn Bhd’s (‘PJH’) proposed Murabahah Commercial Papers / Medium Term Notes Programme (2002/2006) with nominal value of up to RM910 million. The Islamic debt ratings reflect PJH’s issuer ratings, based upon its solid capitalization supported by a superior set of shareholders, exceptional financial flexibility and importance of the company in the development of Putrajaya.
As the concessionaire and developer of the new Federal Government Administrative Centre at Putrajaya, PJH is responsible for the formulation, planning and implementation of the development activities in Putrajaya. This include the construction of infrastructure, Government office buildings, Government quarters, commercial development and certain amenities. The construction of Government buildings on a privatized basis by PJH is covered under a Concession Agreement (CA) signed with the Government in June 1999. Upon the issuance of the Certificates of Practical Completion (CPC) in respect of the buildings, PJH and the Government will enter into lease and sub-lease agreements for a period of 25 years.
The CP/MTN Programme of up to RM910 million is mainly to bridge-finance the construction and other project costs of Parcel E which comprises five Government Ministries; namely Health, Housing and Local Government, National Unity and Social Development, Energy, Communication and Multimedia and Education. The buildings are currently under construction and expected to be completed (together with the issuance of respective CPCs) between November 2003 and February 2004. Given the non-complex nature of construction works and experience of the selected contractors, MARC believes that construction and completion risks are significantly mitigated.
Liquidity risk under the CP/MTN issue is reduced as the commercial papers will be rolled over at the maturity dates. The two-year time buffer between the expected completion dates of construction works and final maturity of the CP/MTN issue affords sufficient time for PJH to secure the necessary refinancing arrangement. Refinancing risk, is, thus, believed to be significantly mitigated.
PJH’s exceptional financial flexibility is drawn from the strength of its shareholders, namely, Khazanah Nasional Bhd, the investment holding company of the Government, and PETRONAS, the national oil and gas company.
As the concessionaire and developer of the new Federal Government Administrative Centre at Putrajaya, PJH is responsible for the formulation, planning and implementation of the development activities in Putrajaya. This include the construction of infrastructure, Government office buildings, Government quarters, commercial development and certain amenities. The construction of Government buildings on a privatized basis by PJH is covered under a Concession Agreement (CA) signed with the Government in June 1999. Upon the issuance of the Certificates of Practical Completion (CPC) in respect of the buildings, PJH and the Government will enter into lease and sub-lease agreements for a period of 25 years.
The CP/MTN Programme of up to RM910 million is mainly to bridge-finance the construction and other project costs of Parcel E which comprises five Government Ministries; namely Health, Housing and Local Government, National Unity and Social Development, Energy, Communication and Multimedia and Education. The buildings are currently under construction and expected to be completed (together with the issuance of respective CPCs) between November 2003 and February 2004. Given the non-complex nature of construction works and experience of the selected contractors, MARC believes that construction and completion risks are significantly mitigated.
Liquidity risk under the CP/MTN issue is reduced as the commercial papers will be rolled over at the maturity dates. The two-year time buffer between the expected completion dates of construction works and final maturity of the CP/MTN issue affords sufficient time for PJH to secure the necessary refinancing arrangement. Refinancing risk, is, thus, believed to be significantly mitigated.
PJH’s exceptional financial flexibility is drawn from the strength of its shareholders, namely, Khazanah Nasional Bhd, the investment holding company of the Government, and PETRONAS, the national oil and gas company.