SELANGOR: MR D.I.Y. Group (M) Bhd, the home improvement and general merchandise retailer leader in Malaysia, has successfully completed its inaugural issuance under its RM5.0 billion sukuk wakalah programmes, raising a total RM540 million, comprising RM525 million Islamic medium-term notes (IMTN) and RM15 million Islamic commercial papers (ICP).
Proceeds from the first sukuk wakalah issuance will be utilised to, amongst others, refinance existing borrowings, support working capital requirements, fund capital expenditure and for general corporate purposes.
The IMTN and ICP have been assigned initial long-term credit ratings of AA1/Stable and P1, respectively, by RAM Rating Services Bhd.
Both indicate the second-highest long-term and highest short-term credit ratings assigned by RAM Ratings, respectively, underscoring the group’s very strong capacity to meet its financial obligations.
The IMTN issuance garnered strong investor demand, with the order book peaking at 6.5 times at the initial price guidance.
This enabled the group to progressively improve the price guidance, leverage the demand momentum to close at a final price of 3.83% per annum for the 7-year tranche and 3.92% per annum for the 10-year tranche, achieving a final oversubscription of approximately 5.6 times despite the prevailing volatile market environment.
The deal attracted a diverse group of investors comprising statutory bodies, pension funds, asset managers, takaful and insurance companies and financial institutions.
CEO Adrian Ong said the group is encouraged by the exceptionally strong reception to its debut sukuk issuance, as evidenced by the lower yield achieved compared to existing borrowings.
“The oversubscription and competitive pricing achieved reflect investor confidence in MR D.I.Y.’s fundamentals, disciplined growth strategy, and ability to deliver sustainable long-term value, even amid ongoing market volatility and geopolitical uncertainty,” he said.
Ong said this issuance marks a landmark milestone for the group as it successfully accessed the Malaysian Islamic capital markets for the first time.
“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,” he said.
CIMB Investment Bank Bhd, Hong Leong Investment Bank Bhd and Maybank Investment Bank Bhd are the joint lead managers for this first issuance of the sukuk wakalah.