KUALA LUMPUR: RAM Ratings has upgraded UEM Group Bhd’s RM2.2 billion Islamic Medium-Term Notes (IMTN) Programme (2012/2042) from AA 2/Stable to AA 1/Stable, issued through funding vehicle United Growth Bhd.
It has also assigned an AA 1 (s)/Stable rating to the proposed IMTN programme of up to RM7.0 billion under another funding vehicle, UEM Olive Capital Bhd, which is a wholly-owned subsidiary of UEM.
The upgrade reflects a stronger government support uplift, given a high likelihood of extraordinary support (previously assessed to be moderately high) from Khazanah Nasional Bhd, which is UEM’s parent and Malaysia’s sovereign wealth fund, it said in a statement today.
"The group is seen as more integral to support the government’s shift to a high-value green economy as outlined by the National Energy Transition Roadmap (NETR).
"Khazanah, as a champion of an integrated Renewable Energy (RE) Zone under the NETR, has identified UEM as its green investment vehicle,” said RAM Ratings.
According to the rating agency, UEM would be tasked to attract investments in green sectors to deliver the fund’s societal, strategic and financial mandates, drive Malaysia’s decarbonisation agenda and upskill Malaysians in green sectors over the long term.
In conjunction with the launch of the NETR, UEM signed a memorandum of understanding with several partners for the development of a one-gigawatt solar photovoltaic plant and a RE industrial park.
The statement said that the plant would be an integral piece of the RE Zone, one of 10 flagship projects under the NETR, and these developments would raise UEM’s prominence in Khazanah’s and the government’s agenda, especially in view of the fund’s role in deploying resources to spur new growth areas that will provide a greater socio-economic impact. - Bernama
