The Zetrix AI sukuk programme is now in default. MARC Ratings downgraded the RM2 billion programme to D-IS after Zetrix AI Bhd (KL:ZETRIX) missed the RM25 million payment. The rating agency had cut the sukuk to C-IS on Oct 30, and it will no longer provide analytical coverage on the company.
The sukuk programme was established in 2022. Zetrix AI issued three-year Islamic debt papers in several tranches.
Why Did the Zetrix AI Sukuk Fall to Default?
The trigger was a breach of a covenant requiring managing director Wong Thean Soon, better known as TS Wong, to remain the company’s largest shareholder. Zetrix AI told Bursa Malaysia on Oct 29 that a dissolution event had been triggered.
An Oct 23 meeting with sukukholders, mainly fund managers and banks, failed to reach an agreement. The company plans another sukukholders’ meeting but has yet to announce a date.
Zetrix AI said it was not required to repay the outstanding sukuk amount immediately. Its next scheduled payment of RM214 million is due in March 2027.
How Much of the Zetrix AI Sukuk Do ARIM Funds Hold?
AmanahRaya Investment Management (ARIM), a subsidiary of government-linked Amanah Raya Malaysia, holds a large share of the sukuk. ARIM confirmed that three of its funds collectively hold less than 30% of the sukuk.
That implies an exposure of more than RM500 million but less than RM600 million. Other fixed-income funds also hold the sukuk, but their individual exposures are generally below RM10 million.
How Far Has TS Wong’s Zetrix AI Stake Fallen?
Wong’s stake has shrunk from nearly 30% to just 1.84%. Forced share sales were triggered by margin calls.
The share price has fallen sharply since late August. The decline has wiped out more than 90% of the group’s market value.
Why Has Bursa Set a Nov 23 Deadline for Zetrix AI’s Dividend?
Zetrix AI has repeatedly delayed the final dividend for the financial year ended Dec 31, 2025 (FY2025) since September. Bursa Malaysia Securities has directed the company to complete the payments by Nov 23.
The regulator also wants Zetrix AI to disclose material information on its financial condition. Investors tracking payouts can review our Dividend Investing Guide for how dividend timing works.
What Else Is Pressuring Zetrix AI’s Cash Flow?
Zetrix AI and its subsidiary MyEG Sdn Bhd were suspended as Road Transport Department (JPJ) collection agents. The suspension followed a failure to remit RM314 million collected on behalf of the government.
MyEG has also been hit with an additional RM353.13 million tax bill. The government has filed suit against the unit.
Key Takeaways
- MARC Ratings cut the RM2 billion Zetrix AI sukuk programme to D-IS.
- The company missed a RM25 million payment; the next RM214 million is due in March 2027.
- Three ARIM funds hold less than 30% of the sukuk, an exposure of more than RM500 million but less than RM600 million.
- TS Wong’s stake has fallen to 1.84%, and market value has dropped more than 90%.
- Bursa has set a Nov 23 deadline for the FY2025 final dividend.
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Disclaimer: This article is for general information only and does not constitute investment advice or a recommendation to buy, sell or hold any security. Figures are taken from the source report and may change. Always do your own research before making any investment decision.
Frequently Asked Questions
Why was the Zetrix AI sukuk downgraded to default?
MARC Ratings cut the RM2 billion Zetrix AI sukuk programme to D-IS after the company failed to settle a RM25 million obligation due on Friday. The downgrade follows a covenant breach tied to TS Wong remaining the largest shareholder.
How much Zetrix AI sukuk does ARIM hold?
ARIM confirmed that three of its funds collectively hold less than 30% of the sukuk. That implies an exposure of more than RM500 million but less than RM600 million.
When is Zetrix AI’s next sukuk payment due?
Zetrix AI’s next scheduled sukuk payment of RM214 million is due in March 2027. The company said it is not required to repay the outstanding sukuk amount immediately.
When must Zetrix AI pay its FY2025 final dividend?
Bursa Malaysia Securities has directed Zetrix AI to complete the outstanding FY2025 final dividend payments by Nov 23. The company must also disclose material information concerning its financial condition.
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Disclaimer: This article is for informational purposes only and does not constitute financial advice. Always do your own research before making investment decisions.
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