KUALA LUMPUR • Malaysian developer Iskandar Waterfront Holdings is considering reviving an initial public offering (IPO) as early as next year as it steps up the construction of projects, including one linked to embattled state fund 1Malaysia Development Berhad (1MDB).
The firm may pursue a dual listing in Malaysia as well as Hong Kong or Singapore as it seeks to monetise some of its assets - valued at more than RM30 billion (S$10 billion) - said Iskandar Waterfront executive vice-chairman Lim Kang Hoo in an interview last week.
He declined to specify how much the sale would raise and did not rule out the possibility of roping in a strategic partner as part of the offering.
1MDB agreed last December to sell 60 per cent of a Kuala Lumpur property project to Iskandar Waterfront and China Railway Engineering for RM7.41 billion, as part of its plans to reduce debt.
The development, known as Bandar Malaysia, will host terminals for a planned high-speed rail line linking KL to Singapore and has an estimated sale value of RM150 billion.
1MDB is now controlled by the Malaysian Finance Ministry.
"This is a very high-impact project," Mr Lim said, dismissing concerns of links to 1MDB, which is at the centre of probes at home and abroad as the authorities seek to determine if some of the billions of dollars it raised were siphoned off.
The development "will sustain the economy for Kuala Lumpur and the country", he said.
Iskandar Waterfront, the master developer of a 1,620ha coastal city in Johor state, deferred a proposal to list in 2013 because of weak market sentiment, Mr Lim said.
While an IPO will help the firm fund its mega real estate projects in KL and Johor, it could also provide a boost to a local stock market that has seen only nine initial share sales begin trading this year, according to data compiled by Bloomberg. The Malaysian exchange has not hosted an IPO exceeding US$500 million (S$688 million) since April last year, the data shows.
The joint venture between Iskandar Waterfront and China Railway is inviting local and foreign firms to participate in the development of Bandar Malaysia, Mr Lim said, adding that work will start next year.
Funding the project's construction is not an issue, as there is a pact with a group of international and local banks that will provide financing, he said.
The government said in May that 1MDB will transfer its 40 per cent stake in Bandar Malaysia to the Finance Ministry as part of efforts to restructure the investment company's debts.