KUALA LUMPUR, June 19 — 1Malaysia Development Bhd, the state investment fund, is working with Deutsche Bank AG and Malayan Banking Bhd on an initial public offering of its power assets, people with knowledge of the matter said.
The two banks are doing initial work on the IPO for 1MDB though the fund may hire additional advisers, according to the people, who asked not to be identified as the process is private. 1MDB could seek as much as US$4 billion (RM12.9 billion) from the share sale, which is scheduled to take place by year-end, they said.
Proceeds will help 1MDB pare its RM25 billion (US$7.8 billion) of outstanding debt after buying energy assets from Malaysian billionaire T. Ananda Krishnan and Genting Bhd, according to data compiled by Bloomberg. A US$4 billion IPO would be Malaysia’s largest since Petronas Chemicals Bhd’s US$4.8 billion share sale in November 2010, the data show.
1MDB, whose advisory board is headed by Prime Minister Najib Razak, has 3,080 megawatts of local generating capacity and 2,490MW overseas, its website shows. The fund won a bid in March to build an RM11 billion, 2,000MW coal-fired power plant in Malaysia together with Japan’s Mitsui Co, according to its latest annual report.
Robert Ho, 1MDB’s head of communications, did not respond to calls and an email seeking comment. — Bloomberg