Zul Rafique & Partners has advised on Tenaga Nasional Berhad’s (TNB) issuance of an Asean Green Sustainable and Responsible Investment (SRI) Sukuk Wakalah worth up to MYR1.05 billion (USD267 million). The proceeds from the sukuk will be used to finance the development of Malaysia’s largest solar power plant, which is also TNB’s biggest renewable energy project to date.
The sukuk was issued by TNB Kuala Muda Solar and structured under the Shariah principle of Wakalah Bi Al-Istithmar. It forms part of Malaysia’s broader push toward green financing and sustainable infrastructure development.
Zul Rafique & Partners acted as legal advisers to CIMB Investment Bank and Maybank Investment Bank for the transaction. The advisory team was led by Loh Mei Mei, head of the banking and finance practice group, together with partner Jayden Chuah.
Chuah explained that the firm’s role mainly involved advising on Malaysian securities laws for the issuance of unlisted capital market products under the Securities Commission Malaysia’s Lodge and Launch Framework. This included compliance with the Capital Markets and Services Act 2007 as well as relevant guidelines issued by the Securities Commission Malaysia.
The transaction also includes several liquidity support and credit enhancement mechanisms aimed at strengthening project stability. According to Chuah, TNB Renewables (TRe), the parent company of the issuer, has committed to covering construction-phase liquidity shortfalls of up to 10% of total project costs through subordinated shareholder advances or equity injections.
Additional support mechanisms may also be provided through standby letters of credit or corporate guarantees from TRe or other entities within the TNB Group to meet reserve account requirements.
The sukuk was structured in accordance with the Securities Commission Malaysia’s Sustainable and Responsible Investment Sukuk Framework, the ASEAN Green Bond Standards, the International Capital Market Association’s Green Bond Principles, and TNB’s own Transition Finance Framework.
Proceeds from the issuance will fund the development, construction, operation, and maintenance of a 500MWac large-scale solar photovoltaic facility located in Kuala Muda, Kedah.
The project will be constructed by Atlantic Blue, a subsidiary of Solarvest Holdings, while PESB Engineering will handle interconnection and substation works. Powertrack, another Solarvest subsidiary, will operate and maintain the plant for two years before management is handed over to TNB Renewables.