Malakoff Prices RM450 Million SRI Sukuk, Sets ASEAN Benchmark for Transition Financing
KUALA LUMPUR, April 29 — Malakoff Corporation Bhd has advanced its sustainable financing strategy with a RM450 million issuance of Sustainable and Responsible Investment (SRI) Sukuk Murabahah by its wholly owned unit, Malakoff Power Bhd.
The transaction, executed under a RM1.2 billion Islamic Medium-Term Notes (IMTN) Programme, is being positioned as ASEAN’s first SRI Sukuk Murabahah dedicated to transition projects—an important step in expanding credible financing options beyond purely “green” assets.
Transition Finance Takes Centre Stage
Malakoff said the structure is designed to mobilise capital for projects that support a measured shift towards a lower-carbon economy. By directing proceeds to both green and transition initiatives, the company is aligning financing with the realities of decarbonising energy systems that cannot transform overnight.
The issuer noted that at least one of the funded projects meets the Amber Tier 2 lifecycle emissions threshold under the ASEAN Taxonomy for Sustainable Finance (Version 2), a classification that provides added assurance on environmental integrity while recognising transitional pathways.
Building on an Established Framework
The sukuk draws on Malakoff’s Sustainable Finance Framework, which outlines eligibility, governance and reporting for the use of proceeds. The company said the approach is intended to ensure transparency and consistency, while supporting Malaysia’s broader policy direction towards cleaner energy and improved resource efficiency.
The issuance also reflects a growing regional focus on transition-labelled instruments, which complement green financing by supporting sectors that are reducing emissions intensity over time.
Robust Demand in a Volatile Market
Investor appetite for the sukuk proved strong despite choppy market conditions. Malakoff reported that the order book peaked at close to five times the issue size and closed at 4.5 times oversubscribed.
The depth of demand enabled MPower to tighten pricing to levels below its 2025 issuance, effectively establishing a new benchmark for the company’s cost of funds.
Market participants said the response underscores continued interest in high-quality Islamic instruments with clear sustainability credentials.
Advisory and Shariah Oversight
Maybank Investment Bank Bhd acted as sole principal adviser, lead manager and sustainability structuring adviser, while Maybank Islamic Bhd served as Shariah adviser.
Their roles included ensuring the structure met regulatory, Shariah and sustainability requirements, as well as aligning the transaction with recognised regional standards.
Positioning for Long-Term Energy Transition
Malakoff said the sukuk supports its broader strategy to integrate sustainability into capital management and project development. As Malaysia and the wider ASEAN region accelerate energy transition efforts, such instruments are expected to play a larger role in bridging funding gaps for infrastructure and technology upgrades.
With ESG-focused capital continuing to expand, the company’s latest issuance highlights the evolution of Islamic finance as a vehicle for both green and transition investments.
-wilayah.com.my
