1. On behalf of TM’s Board of Directors, CIMB Investment Bank Berhad (“CIMB”) and Maybank Investment Bank Berhad (“Maybank IB”) are pleased to announce that TM has today received approval from the Securities Commission Malaysia (“SC”) for the proposed establishment of an ICP programme (“Proposed ICP Programme”) and an IMTN programme (“Proposed IMTN Programme”) with a total combined limit of up to RM3.0 billion in nominal value (the Proposed ICP Programme and the Proposed IMTN Programme are collectively referred to as the “Sukuk Wakalah Programmes”).

   The Proposed ICP Programme and the Proposed IMTN Programme, which have respective tenures of 7 years and 20 years from the date of first issue, have been assigned indicative ratings of P1 and AAA respectively by RAM Rating Services Berhad. The other salient terms and conditions of the Sukuk Wakalah Programmes are set out in Appendix I.

2. The Sukuk Wakalah Programmes are established in line with the objectives of TM’s capital management framework including capital structure/cost optimisation and shareholders’ value enhancement. The Sukuk Wakalah Programme is established based on the Shariah principle of Wakalah Bi-Al-Istithmar. The underlying assets used under the Shariah principle include, (i) units representing the average capacity of TM’s UniFi High Speed Broadband services to its consumers and business customers and/or any other Shariah-compliant qualified assets owned by TM which shall be represented by a voucher, as approved by the Joint Shariah Advisers; and (ii) Shariah-compliant commodities which would exclude the ribawi items in the category of medium of exchange such as currency, gold and silver.

   The Sukuk Wakalah Programmes shall provide TM with the flexibility to manage its fund-raising requirements over the tenures of the Sukuk Wakalah Programmes, and to have an alternative access to debt funding, in addition to conventional bank borrowings.

   The proceeds to be raised through the issuance of ICP and/or IMTN (collectively “Sukuk”) will be utilised to meet TM’s capital expenditure and business operating requirements, including expenditure for its high speed broadband services which shall be Shariah-compliant.

3. The Sukuk Wakalah Programmes and any issuance of Sukuk thereunder will not have any effect on TM's issued and paid-up share capital or substantial shareholders' shareholdings in TM.

   Pending any issuance, the Sukuk Wakalah Programmes will also not have any effect on the consolidated gearing of TM and will not have a material effect on TM’s consolidated net assets or consolidated earnings.

   Any issuance of Sukuk under the Sukuk Wakalah Programmes will increase TM’s consolidated gearing, the quantum of which is dependent on the amount raised. The effects of any issuance of Sukuk under the Sukuk Wakalah Programmes on TM’s consolidated earnings will depend on, amongst others, the effective borrowing cost of such issuance and the specific use of proceeds thereof, both of which cannot be determined at this stage. Nonetheless, TM intends to only undertake issuance under the Sukuk Wakalah Programmes to the extent that its consolidated gearing level would remain manageable, after taking into consideration its then prevailing cashflow/financial position and prospects.

4. Other than the approval of the SC, the Sukuk Wakalah Programmes are not subject to any regulatory and/or shareholder approval.
   
   
5. None of TM’s Directors, major shareholders and/or persons connected to TM’s Directors and/or major shareholders has any interest, direct or indirect, in the Sukuk Wakalah Programmes.
   
   
6. CIMB and Maybank IB have been appointed as the Joint Principal Advisers, Joint Lead Arrangers, Joint Lead Managers and Joint Book Runners for the Sukuk Wakalah Programmes. The Joint Shariah Advisers for the Sukuk Wakalah Programmes are CIMB Islamic Bank Berhad and Maybank Islamic Berhad.

This announcement is dated 30 August 2013.