Wednesday, 31st October 2012

We write to inform you that the Board of Directors of Dialog Axiata PLC (“Company”) has duly approved the proposed establishment of a Malaysian Ringgit denominated Islamic Medium Term Note Programme under the Shariah principle of Murabahah (“Sukuk Murabahah”) of up to Ringgit Malaysia 1.2 Billion in nominal value (or its equivalent in USD) with a tenure of 15 years in Malaysia (“Sukuk Programme”). Pursuant to the above, the Company may, under the Sukuk Programme, issue Sukuk Murabahah from time to time involving selected Shariah-compliant commodities.

It is proposed that the proceeds raised from the issuance of the Sukuk Murabahah under the Sukuk Programme shall be utilised by the Company in compliance with Shariah principles for the following purposes:-

(i) Refinancing of existing debt and Sukuk issued under the Sukuk Programme;
(ii) Payment of fees and expenses in connection with the refinancing of the existing debt and the Sukuk Programme;
(iii) Funding of investments, operational expenses and capital expenditure; and
(iv) Working capital and other corporate and funding purposes.

The proposed establishment of the Sukuk Programme is subject to the approval of the relevant regulatory authorities in Sri Lanka and Malaysia and the completion of the proposed establishment of the Sukuk Programme is subject to market conditions and investor interest. As no binding agreement in relation to the proposed issuance of the Sukuk Murabahah has been entered into at the date of this announcement, the proposed establishment of the Sukuk Programme may not materialize.

The Company will keep the Colombo Stock Exchange informed of the definitive terms of the Sukuk Programme upon finalization.

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