TENAGA NASIONAL BERHAD

Transcription

1 TENAGA NASIONAL BERHAD PROPOSED ISSUE OF UP TO RM1,500 MILLION FIXED INCOME SECURITIES Issuer : Tenaga Nasional Berhad ( TNB / Company ). Adviser/Lead Arranger : RHB Sakura Merchant Bankers Berhad ( RHB Sakura ). Structuring Adviser : Macquarie (Malaysia) Sdn Bhd. Type of Facility and Amount : Fixed income securities issue of up to an amount of RM1,500 million ( Facility ) consisting of:- (a) 1,500 fixed rate coupon-bearing bonds ( Bonds ) of RM999,000 each. The Bonds shall comprise a principal element ( Bond Principal ) and a coupon element ( Bond Coupon ). (b) 1,500 redeemable preference shares ( RPS ) of RM1 each at an issue price of RM1,000 for each RPS ( RPS Issue Price ). The RPS shall be stapled to the Bonds and issued as a single instrument ( Tenaga Income Securities ). A total of 1,500 Tenaga Income Securities with a total value of RM1,500 million shall be issued in 2 tranches as follows:- Tranche Bonds (RM mil) RPS (RM mil) Total (RM mil) , , * 1,500.0 * Comprising 1,500 RPS of RM1 each at an issue price of RM1,000 for each RPS. Purpose : Proceeds from the Facility shall be utilised to finance TNB s capital expenditure requirements. Page 1 of 10

2 Issue Date : Both tranches of the Tenaga Income Securities shall be issued within 6 months from the date of the Securities Commission s approval of the Facility. Tenor : Bonds The Bonds shall be for a tenor of 10 years from the date of issue. RPS The RPS shall not have a fixed tenor. Issue Price : Bonds The Bonds shall be issued at par. RPS The RPS shall be issued at a premium. Mode of Issue : Bought-deal basis. Redemption : Bonds Unless previously redeemed or purchased and cancelled, the Bonds shall be redeemed by TNB at par on maturity. RPS The RPS shall be redeemable by TNB at any time after the 9 th anniversary of the date of issue at the RPS Issue Price. The share premium created under the RPS issue shall be maintained for purposes of redemption of the RPS. Form and Denomination : Bonds The Bonds shall be issued in bearer form and in denominations of RM1,000 each or a multiple thereof. RPS The RPS shall be issued in registered form and in denominations of RM1 each or a multiple thereof. Security for Bondholders : Clean. Covenant : Negative pledge. Page 2 of 10

3 Payment Date : A date falling on the maturity of each 6 month period from the date of issue of the Bonds or RPS, as the case may be. Dividend on RPS : Non-cumulative dividend on the RPS ( RPS Dividend ) may be payable on the Payment Date at a rate to be determined multiplied by the total value of the Tenaga Income Securities. For the purposes of the Income Tax Act 1967 and subject to the Companie s Act 1965, the RPS Dividend shall be payable with the relevant required amount of Section 108 tax credits attached. Dividend Payment Event : TNB declares and pays the RPS Dividend on or before the Payment Date. RPS Redemption Event : TNB redeems the RPS at the RPS Issue Price. Interest on Bonds : Interest on the Bonds i.e. the Bond Coupon shall be payable on the Payment Date as follows:- (a) Year 1 to Year 10 (Except Final Payment) At a rate to be determined multiplied by the total value of the Tenaga Income Securities. (b) Year 10 (Final Payment) At a rate to be determined multiplied by the total value of the Tenaga Income Securities plus RM1 million (Tranche 1)/RM0.5 million (Tranche 2). The RM1 million (Tranche 1)/RM0.5 million (Tranche 2) shall be due on the 1 st Payment Date but payment is deferred to the earlier of the Final Payment Date and the date the Bonds are accelerated due to an event of default. However, if a RPS Redemption Event occurs, the final payment shall be equal to (a) above. Page 3 of 10

4 Notwithstanding the above, if a Dividend Payment Event occurs, the Bond Coupon shall be reduced to a nominal amount ( Nominal Bond Coupon ) payable on the Payment Date as follows:- (a) Year 1 to Year 10 (Except Final Payment) At 0.01% per annum multiplied by the total value of the Tenaga Income Securities. (b) Year 10 (Final Payment) At 0.01% per annum multiplied by the total value of the Tenaga Income Securities plus RM1 million (Tranche 1)/RM0.5 million (Tranche 2). The RM1 million (Tranche 1)/RM0.5 million (Tranche 2) shall be due on the 1 st Payment Date but payment is deferred to the earlier of the Final Payment Date and the date the Bonds are accelerated due to an event of default. However, if a RPS Redemption Event occurs, the final payment shall be equal to (a) above. Method of Implementation : 1) A financial institution ( Facilitator ) shall subscribe for the Tenaga Income Securities for a consideration of RM1,000 million (Tranche 1)/RM500 million (Tranche 2). 2) The Facilitator shall destaple the Tenaga Income Securities into its individual components i.e. Bond Principal, Bond Coupon and RPS. The Facilitator shall hold the Bond Coupon and RPS until maturity and redemption thereof respectively (unless transferred, in which event the transferee shall also assume the role and functions of the Facilitator). 3) The Facilitator shall undertake a conditional payment obligation ( CPO ) which represents the coupon payable on, and shall be attached to, the Bond Principal (in place of the detached Bond Coupon). The CPO shall be for an amount equal to the amount of coupon payable on the Bond Principal and payable on the Payment Date, including an additional payment of RM1 million (Tranche 1)/RM0.5 million (Tranche 2) together with the final CPO payment. Payment of the CPO shall be conditional upon the Facilitator receiving either the RPS Dividend/Nominal Bond Coupon or Bond Coupon payments from TNB. Page 4 of 10

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6 4) The Bond Principal and attached CPO ( Repackaged Tenaga Income Securities ) shall be sold to investors for a consideration of RM1,000 million (Tranche 1)/ RM500 million (Tranche 2). 5) Towards ensuring that the Repackaged Tenaga Income Securities reflect TNB risk, the following shall be undertaken:- (a) The Bond Coupon and RPS shall be charged as security for the CPO. (b) The Facilitator shall issue an irrevocable and unconditional payment instruction directing TNB to make all RPS Dividend/Nominal Bond Coupon and Bond Coupon payments to an account ( Special Account ) in the name of the Facilitator. The Special Account shall be charged as security for the CPO. All amounts (RPS Dividend/Nominal Bond Coupon and Bond Coupon payments from TNB and any top-up payment, if necessary, from the Facilitator) paid into the Special Account shall only be withdrawn for purposes of meeting the CPO payments. The top-up payment from the Facilitator shall be the difference between the proceeds received from TNB and the CPO amount. (c) TNB and the Facilitator shall enter into an agreement under which:- (i) TNB shall give notice to the Facilitator no later than T-4 ( T being the Payment Date) of TNB s ability and intention to pay the RPS Dividend/Nominal Bond Coupon amount into the Special Account on T-1, upon which the Facilitator s obligation to pay the top-up amount would arise under the provisions of the CPO; (ii) The Facilitator undertakes that upon receipt of the notice referred to in (a) above, it will pay the top-up amount into the Special Account on T-2; Page 6 of 10

7 (iii) TNB and the Facilitator covenant with each other that in the event the Facilitator defaults in paying the top-up amount into the Special Account on T-2, then TNB shall pay the Bond Coupon amount (instead of the RPS Dividend/Nominal Bond Coupon amount) into the Special Account on T-1; (iv) The Facilitator indemnifies TNB for all actual losses suffered by TNB arising from default by the Facilitator in paying the top-up amount into the Special Account on T-2, subject to a maximum amount not exceeding the top-up amount; and (v) TNB undertakes that in the event the Facilitator pays the top-up amount into the Special Account on T-2, TNB will pay the RPS Dividend/Nominal Bond Coupon amount into the Special Account on T-1, failing which TNB indemnifies the Facilitator in full for any and all losses suffered by the Facilitator. The timing for the notification/payments above are subject to the Kuala Lumpur Stock Exchange granting TNB an exemption from the requirement to comply with its guidelines on the timing for declaration and payment of dividends in respect of the RPS. Should the exemption not be granted, the timing for notification/payments will be brought forward to ensure compliance with the said guidelines. Selling Restrictions : The Tenaga Income Securities may not be offered or sold, directly or indirectly, nor may any document or other material in connection therewith be distributed in Malaysia, other than to persons falling within any one of the categories of persons specified under Schedules 2 and 3 of the Securities Commission Act Rating : The Tenaga Income Securities/Repackaged Tenaga Income Securities shall have a minimum long-term rating of AA1 by Rating Agency Malaysia Berhad at the date of issue. Page 7 of 10

8 Trading and Settlement Mechanism : The Repackaged Tenaga Income Securities shall be tradeable and transferable under the Real Time Electronic Transfer of Funds and Securities (RENTAS) System maintained by Bank Negara Malaysia ( BNM ). Change in Tax Law : Where there is a change in the taxation laws of Malaysia, such that it becomes unfavourable for TNB to pay the RPS Dividend or it becomes unfavourable for the Facilitator to receive the RPS Dividend, TNB shall cease to declare and pay the RPS Dividend. Indemnity by TNB : In the event that the RPS Dividend is not deemed to be dividends for tax purposes, TNB shall indemnify the Facilitator for the top-up payment and related costs incurred, for periods affected by such tax treatment. Facilitator : Tranche 1 RHB Sakura. Tranche 2 RHB Bank Berhad ( RHB Bank ) (subject to BNM s approval for RHB Bank to invest in the RPS of TNB in respect of Tranche 2). Primary Subscribers : Tranche 1 (RM mil) Tranche 2 (RM mil) RHB Sakura RHB Bank 1, , Central Depository and Paying Agent : BNM. Trustee : Malaysian Trustees Berhad. Page 8 of 10

9 Terms and Conditions of the RPS : The terms and conditions of the RPS shall include but not be limited to the following:- (a) As regards income Each RPS shall confer on the holder thereof the right to be paid on the Payment Date, out of the profits of the Company available for distribution in respect of each financial year or other accounting period of the Company and in priority to any payment in respect of any other class of shares in the capital of the Company, a preferential dividend as set out in Dividend on RPS above. (b) As regards capital The RPS shall not confer on the holder thereof any right to participate on a return in excess of capital on liquidation, winding-up or otherwise of the Company, other than on redemption up to the RPS Issue Price. (c) As regards voting The RPS shall not confer on the holder thereof any rights to receive notice of or to attend or vote at any general meeting of the Company, other than on a resolution to amend or vary the rights of holders of RPS in respect of its class. (d) As regards ranking The RPS shall rank pari passu among themselves, within its respective class. (e) As regards redemption The RPS may be redeemed by the Company at any time on or after the 9 th anniversary of the RPS issue or on a liquidation or winding-up of the Company, whichever is earlier. (f) As regards transfer The RPS holders shall have the right to transfer in whole or in part their interests in the RPS subject to the Company s consent, which consent shall not be unreasonably withheld. Page 9 of 10

10 (g) As regards further participation Save as expressly provided in the terms of the RPS, the RPS shall not confer on the holder thereof any entitlement to participate in the profits or assets of the Company. Other Terms and Conditions : 1) Issue of the Tenaga Income Securities shall be subject to the prior approval of the Securities Commission and such other relevant authorities, if any. 2) Issue of the Tenaga Income Securities shall be in accordance with the Code of Conduct and Market Practices for the Malaysian Corporate Bond Market prepared by Institut Peniaga Bon Malaysia and approved by BNM. 3) All expenses, including but not limited to legal, printing, publicity and out-of-pocket expenses, incurred by the Adviser/Lead Arranger in connection with the negotiation and documentation of the transaction shall be for the account of TNB. Governing Law and Jurisdiction : The laws of Malaysia and the exclusive jurisdiction of the Courts of Malaysia. Page 10 of 10