PETRONAS SUCCESSFULLY CONCLUDES LARGEST EVER BOND ISSUE BY AN ASIAN CORPORATION

PETRONAS, through wholly-owned subsidiary PETRONAS Capital Limited, has successfully raised US$2.675 billion equivalent from its latest global bond issue — the largest corporate bond issue to have ever been concluded by an Asian corporation in the international debt capital market.

In its return to the market since 1999, PETRONAS launched its first global multi-currency debt offering in New York on Monday, 13 May 2002 with an original size of US$1 billion 10-year tranche and Euro 500 million 7-year tranche. International fixed income investors responded overwhelmingly towards the issue and placed orders amounting to around US$7 billion equivalent.

The issue was upsized to US$1.3 billion for the 10-year tranche and the Euro 7-year tranche to Euro 750 million. A US$700 million 20-year tranche was also introduced as a result of the strong demand.

The transaction was priced on Wednesday, 15 May 2002 following a week-long roadshow commencing on 6 May 2002 covering Hong Kong, Singapore, Frankfurt, Munich, London, Amsterdam, Edinburgh, Boston and concluding in New York.

The US$1.3 billion 10-year tranche was priced at 10-year US Treasury plus 175 basis points which was at the tight end of the price guidance range of 175 to 185 basis points. The price was comparable with a new Malaysian sovereign 10-year issue. The US$700 million 20-year tranche was priced at 43 basis points over the 10-year issue and the Euro tranche was priced at Euribor plus 115 which was also at the tight end of the price guidance range of Euribor plus 115-125.

Approximately 526 orders were allocated, with a geographic split on the US Dollar tranches of 32 per cent in Asia, 15 per cent in Europe and the Middle East and 53 per cent in North America. The Euro tranche was the largest ever Euro offering by an Asian issuer and 45 per cent of the Euro tranche was sold into Asia, with 52 per cent being sold to investors in Europe and the Middle East and 3 per cent to North American investors.

The proceeds from the bonds will be used to finance PETRONAS’ international projects.

Morgan Stanley was the Global Coordinator for the transaction with Morgan Stanley and Salomon Smith Barney acting as Joint Bookrunners on the US Dollar tranche and Morgan Stanley, Barclays Capital and HSBC acting as Joint Bookrunners on the Euro tranche.

Issued by
Legal and Corporate Affairs Division

May 16, 2002OffshoreMan

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