UEM Group to issue RM7bil sukuk for green foray, seeks organic growth and potential M&As

UEM Group to issue RM7bil sukuk for green foray, seeks organic growth and potential M&As


KUALA LUMPUR: UEM Group Bhd, the green investment platform of Khazanah Nasional Bhd, plans to issue RM7 billion sustainable sukuk, seeking to grow its assets organically as well as explore mergers and acquisitions over the next five years.

UEM Group is also seeking strategic partnerships as it takes a proactive approach to further develop green industry in the country under its newly-formed, wholly-owned UEM Lestra Bhd.

UEM Group is currently putting in place a RM7 billion Sustainable and Responsible Investment (SRI) sukuk programme with the proceeds used to finance investments to be undertaken by UEM Lestra.

"We will be taking a proactive approach to further develop green industry in the country with an aim of creating green domestic champions, driving Malaysia's decarbonisation agenda, and create high quality employment opportunities for Malaysians," the group said today.

"UEM Group's plans for the next five years (2023 to 2027) is to strengthen and organically grow the green assets and operations of its other subsidiaries, nurture local and capable green players and form strategic partnerships including joint ventures to undertake projects in four sectors," it added.

The four sectors include renewables and storage infrastructure (such as solar farms, mini hydro plants and biogas), integrated energy solutions (green building services, end-to-end energy services such as distributed energy generation technologies and energy efficiency related services.

Others are green or electric mobility including electric vehicle charging infrastructure

maintenance and services, and waste management and recycling including waste treatment and disposal.

UEM Group managing director Datuk Mohd Izani Ghani said it is long known as Malaysia's nation building partner.

"We will now play the same role but with greater focus on tackling climate change by supporting and developing the country's green industries from renewable energy (RE), waste management to green infrastructure and transportation," Mohd Izani said in a statement.

He said UEM Group plans to strengthen the domestic economic ecosystem and build a competitive green business with a direct and active ownership approach, and ultimately achieve commercial returns.

It has identified several capable local and international green energy players with commendable track record and presence across the country that are seeking the involvement of a strategic investor to expand their operations.

In addition, the  group is currently in talks with several foreign investors who are keen to invest in the development of RE in Malaysia.

Details will be announced before the end of this year, it said.

"We intend to lead the country's decarbonisation agenda and this includes supporting the government's efforts to transition towards sustainable energy solutions and to be a carbon-neutral nation, achieving a 70 per cent RE capacity in the country's electricity supply by 2050," Mohd Izani said.

"We will also be working towards enhancing the domestic green capabilities over the long term and increasing the country's competitiveness by upskilling and developing local workforce talent. Our aim is twofold – to create more jobs and offer high-quality employment opportunities," he added.

Established in 1966 and responsible for many of Malaysia's key infrastructure projects,

UEM Group's other core businesses for which it owns majority stakes includes expressways (PLUS Malaysia Bhd), township and property development (UEM Sunrise Bhd) and engineering and construction (UEM Builders Bhd and Cement Industries of Malaysia Bhd).

https://www.nst.com.my/business/2023/07/926754/uem-group-issue-rm7bil-sukuk-green-foray-seeks-organic-growth-and-potential