HomeResearch & Knowledgeback to HomeFinanceback to Research & KnowledgeTM Menara ABS: Value creation and Islamic financeback to Finance

Case Study

TM Menara ABS: Value creation and Islamic finance

By Salvatore Cantale and Martin Králik

14 pages

June 2013

Order this case study

Reference: IMD-1-0340

The case considers Telekom Malaysia’s 2007 decision to demerge its mobile and fixed telecommunications services, against the background of TM’s broader strategy aimed at optimizing the group’s operations and improving shareholder value. This process would see the group restructure its balance sheet and offload some of its non-core assets such as office buildings. The case provides a basic overview of Islamic finance instruments such as sukuk, and illustrates their application in infrastructure financing. It describes the rationale behind TM’s choice of an “ijarah sukuk” transaction structure as a type of Shariah-compliant asset-backed securitization, and lists the benefits offered by this particular structure in the context of value creation.

Learning Objective

The case provides a good opportunity to discuss Islamic finance in the context of an interesting transaction (TM Menara ABS), reflect on what constitutes value creation and address the value proposition of Islamic finance.

Keywords

Islamic Finance, Islamic Banking, Value Creation, Sukuk, Finance

Settings

South-Eastern Asia, Malaysia
2006 – 2007

Type

Field Research

Available Languages

English

Related material

Teaching note

IMD case studies are distributed through case clearing houses. In order to browse the collection and purchase copies please visit the links below.

The Case Centre

Cranfield University

Wharley End Beds MK43 0JR, UK
Tel +44 (0)1234 750903
Email [email protected]

Harvard Business School Publishing

60 Harvard Way, Boston MA 02163, USA
Tel (800) 545-7685 Tel (617)-783-7600
Fax (617) 783-7666
Email [email protected]

Asia Pacific Case Center

NUCB Business School

1-3-1 Nishiki Naka
Nagoya Aichi, Japan 460-0003
Tel +81 52 20 38 111
Email [email protected]

IMD retains all proprietary interests in its case studies and notes. Without prior written permission, IMD cases and notes may not be reproduced, used, translated, included in books or other publications, distributed in any form or by any means, stored in a database or in other retrieval systems. For additional copyright information related to case studies, please contact Case Services.

Contact

Research Information & Knowledge Hub for additional information on IMD publications

Keep reading

Article

Can Europe’s unified bond compete with US treasuries?

The idea of an EU bond, a common safe asset, has been gaining attention lately, particularly following calls for its introduction this month by for...

Finance Global Business Competitiveness

By Arturo Bris

in The National

11 October 2024

Article

Redefining wealth management: How family offices can lead the charge in responsible investing

Family offices are uniquely positioned to drive positive change through impact investing by leveraging their wealth, influence, and values to creat...

Family Business Finance

By Peter Vogel and Risto Väyrynen

in I by IMD

Article

Impact orientation and venture capital financing: The interplay of governmental, social impact and traditional venture capital

In addition to traditional venture capital (VC), governmental VC and social impact VC investors have emerged as alternatives to fund entrepreneuria...

Finance Venture Capital Social Innovation

By Valentina Lo Mele, Anita Quas, Patrick Reichert and Stefano Romito

in Finance Research Letters

October 2024, vol. 68, 105987, https://doi.org/10.1016/j.frl.2024.105987

Article

¿Dónde se queda corta la estrategia industrial de Mario Draghi para Europa?

The call by the former Italian prime minister and ECB president for massive investment in the EU is a wake-up call to Europe's economic stagnation....

Global Business Finance Strategy

By Arturo Bris

in Expansión

30 September 2024

Article

The great diversification: Why pension funds are moving beyond stocks and bonds

In an effort to increase returns and control risk, pension funds are moving away from conventional equities and bonds into alternative investments ...

Economics Finance Growth Venture Capital

By Anca Mataoanu

in I by IMD

Article

Carbon risk and equity prices

We study the effects of carbon transition risk on equity prices in the United States and Europe using disclosed carbon intensity data and find a ne...

Finance Sustainability

By Arthur Enders, Thomas S. Lontzek, Karl Schmedders and Marco Thalhammer

in The Financial Review

16 September 2024, ePub before print, https://doi.org/10.1111/fire.12414

Report

Humanitarian impact finance: Instruments & approaches

This report provides a first mapping of the humanitarian impact finance continuum to identify different sources of funding for each respective acto...

Finance Geopolitics Crisis Management

By Vanina Farber, Patrick Reichert, Maximilian Martin and Juan Luiz Coderque Galligo

IMD Center for Social Innovation Report, September 2024

Article

Analyzing swings in Bitcoin returns: A comparative study of the LPPL and sentiment-informed random forest models

Forecasting Bitcoin’s returns continues to be a challenging endeavor for both scholars and practitioners. In this paper, we train a random forest m...

Finance

By José Parra Moyano, Daniel Partida, Moritz Gessl and Somnath Mazumdar

in Digital Finance

September 2024, vol. 6, pp. 427–439, https://doi.org/10.1007/s42521-024-00110-7

Article

What China’s fading appeal to foreign investors means for its economy

For years, the sheer size of China’s economy made it an irresistible magnet for foreign investors, with many – including sovereign wealth funds fro...

China Finance Global Business

By Simon J. Evenett

in The National

16 August 2024

Article

How do big-ticket US subsidies affect foreign investment?

US President Joe Biden once described the Inflation Reduction Act (IRA) as one of “the most significant laws” ever enacted due to its massive inves...

Can Europe’s unified bond compete with US treasuries?

By Arturo Bris
in The National 11 October 2024

Summary

The idea of an EU bond, a common safe asset, has been gaining attention lately, particularly following calls for its introduction this month by for...

Contact

Research Information & Knowledge Hub for additional information on IMD publications

Related topics

Finance

Global Business

Competitiveness

Browse all topics

Impact orientation and venture capital financing: The interplay of governmental, social impact and traditional venture capital

By Valentina Lo Mele Anita Quas Patrick Reichert and Stefano Romito
in Finance Research Letters October 2024, vol. 68, 105987, https://doi.org/10.1016/j.frl.2024.105987

Summary

In addition to traditional venture capital (VC), governmental VC and social impact VC investors have emerged as alternatives to fund entrepreneuria...

Contact

Research Information & Knowledge Hub for additional information on IMD publications

Related topics

Finance

Venture Capital

Social Innovation

Browse all topics

¿Dónde se queda corta la estrategia industrial de Mario Draghi para Europa?

By Arturo Bris
in Expansión 30 September 2024

Summary

The call by the former Italian prime minister and ECB president for massive investment in the EU is a wake-up call to Europe's economic stagnation....

Contact

Research Information & Knowledge Hub for additional information on IMD publications

Related topics

Global Business

Finance

Strategy

Browse all topics

The great diversification: Why pension funds are moving beyond stocks and bonds

By Anca Mataoanu
in I by IMD

Summary

In an effort to increase returns and control risk, pension funds are moving away from conventional equities and bonds into alternative investments ...

Contact

Research Information & Knowledge Hub for additional information on IMD publications

Related topics

Economics

Finance

Growth

Venture Capital

Browse all topics

Carbon risk and equity prices

By Arthur Enders Thomas S. Lontzek Karl Schmedders and Marco Thalhammer
in The Financial Review 16 September 2024, ePub before print, https://doi.org/10.1111/fire.12414

Summary

We study the effects of carbon transition risk on equity prices in the United States and Europe using disclosed carbon intensity data and find a ne...

Contact

Research Information & Knowledge Hub for additional information on IMD publications

Related topics

Finance

Sustainability

Browse all topics

Humanitarian impact finance: Instruments & approaches

By Vanina Farber Patrick Reichert Maximilian Martin and Juan Luiz Coderque Galligo
IMD Center for Social Innovation Report, September 2024

Summary

This report provides a first mapping of the humanitarian impact finance continuum to identify different sources of funding for each respective acto...

Available Languages English

Contact

Research Information & Knowledge Hub for additional information on IMD publications

Related topics

Finance

Geopolitics

Crisis Management

Browse all topics

What China’s fading appeal to foreign investors means for its economy

By Simon J. Evenett
in The National 16 August 2024

Summary

For years, the sheer size of China’s economy made it an irresistible magnet for foreign investors, with many – including sovereign wealth funds fro...

Contact

Research Information & Knowledge Hub for additional information on IMD publications

Related topics

China

Finance

Global Business

Browse all topics