Malaysian sovereign fund 1Malaysia Development Bhd (1MDB) is preparing to list its power assets in January, seeking to raise more than US$3 billion, after finalising a second debt refinancing agreement this month, sources with direct knowledge of the matter said.

Plans for the IPO, which is aimed at helping 1MDB cut down a debt burden exceeding US$11 billion, had been delayed due to a longer-than-expected due diligence process and negotiations surrounding its first debt refinancing agreement.

1MDB, which owns 16 power and desalination plants in six countries, is aiming to file its listing application later this month, three people familiar with the matter told Reuters.

“A listing will be in January if the application goes through,” one of the sources on the IPO timing said. The people declined to be identified as the matter has not been disclosed officially.

1MDB, whose advisory board is chaired by Malaysian Prime Minister Najib Abdul Razak, is also close to signing a US$1 billion one-year loan to refinance group debt, Basis Point, a Thomson Reuters publication, reported citing sources.

That follows the restructuring of a RM5.5 billion (US$1.7 billion) bridging loan into two tranches in May. It was not immediately clear if the new US$1 billion loan repays part of the restructured bridging loan, a portion of which is due in November.

Representatives for 1MDB were not immediately available to comment. Sources declined to be identified as details of the IPO and the new loan have not been officially announced.

Controversy has dogged 1MDB almost since it was first set up five years ago after Najib came to power.

Critics, including former prime minister Mahathir Mohamad, have questioned the fund’s investment choices, the size of its debt, US$2.25 billion parked in a Cayman Island fund as well as hundreds of millions of dollars of revenue earned by Goldman Sachs for handling its bond issues.

If it garners more than US$3 billion, the IPO may rank among South-East Asia’s top five. 1MDB has picked Deutsche Bank, Goldman Sachs, and two local banks Maybank and AmBank as advisers for the IPO.

- Reuters