KUALA LUMPUR: IHH Healthcare Bhd via its subsidiary, Pantai Holdings Sdn Bhd, has issued its inaugural Sukuk, worth RM4 billion, under a newly established RM15 billion Sukuk Wakalah Programme.
This programme offers the group a strategic avenue to diversify its funding sources, strengthening its growth initiatives in Malaysia.
Furthermore, the programme is designed to enable the issuance of both sustainability and sustainability-linked sukuk, in alignment with the group's capital management and sustainability goals.
The proceeds from this initial sukuk issuance are to fund the acquisition of the 600-bed capacity Island Hospital, which was announced in early September this year.
IHH Healthcare group chief executive officer, Dr. Prem Kumar Nair said Island Hospital is a highly attractive asset with strong operations in Penang, a fast-growing market, and supported by a large specialist pool and clinical offerings with strong operational metrics.
"This acquisition creates a medical tourism powerhouse to support the country's aspirations, as Island Hospital is the leading medical tourism hospital in Malaysia. The acquisition also demonstrates continued investment in IHH Healthcare's home market with strong growth, leveraging on Pantai's proven operating track record and successful M&As," he said.
IHH Healthcare group chief financial officer Dilip Kadambi said the acquisition of Island Hospital allows the group to build on its leadership position in Penang while also providing a platform for future growth with capacity expansion and greenfield opportunities in addition to being financially attractive and return on equity accretive.
"This transaction was financed through the group's first ever issuance of RM4 billion unrated Sukuk through the Sukuk Programmes at optimal pricing and is one of the largest Sukuk issued years to date in Malaysia," he said.
Notably, the Sukuk issuance has received tremendous support, achieving a subscription rate exceeding four times the issuance size.
OCBC Al-Amin Bank Bhd acted as the sole principal adviser, lead arranger, sustainability structuring adviser, shariah adviser, facility agent, and lead manager for the sukuk programmes.
The bank's senior banker and head of investment banking, Tan Ai Chin, said OCBC's significant role in this landmark transaction demonstrates its strategic client relationship in supporting IHH Healthcare from the inception to becoming one of the largest private healthcare providers in the world.
OCBC is an existing sole financier to Island Hospital, supporting them through the entire development journey to becoming a formidable healthcare provider in Penang, he said.
"This demonstrates OCBC's strong coverage and expertise in the healthcare sector and our continued pioneering effort in facilitating cost-effective sustainable financing solutions in supporting our valued clients like IHH Healthcare in their growth journey."