Unggul Indah get $120m in loans<\/p>\n
SINGAPORE (JP): PT Unggul Indah Corporation (UIC), Indonesia's
\nsole producer of alkylbenzene, yesterday secured US$120 million
\nin loans from a syndication of 24 international banks to finance
\nits expansion projects and debt repayment.<\/p>\n
The loans, with maturity periods ranging from three to five
\nyears, will carry an average interest rate of 1.375 percentage
\npoints above the Singapore Inter-bank Offered Rate (SIBOR), which
\nat present reaches around six percent per annum.<\/p>\n
UIC president Hartono Gunawan said that the company initially
\napplied for US$100 million from the bank syndication but the
\namount was raised to $120 million due to a substantial over-
\nsubscription.<\/p>\n
"The subscription, in fact, reached $149 million but we
\nsecured only $120 million," he said after the signing of the loan
\ncommitment here.<\/p>\n
The loan syndication was jointly arranged and underwritten by
\nChase Manhattan Asia Limited, the Jakarta branch of
\nInternationale Nederlanden Bank, the Singapore branch of Japan's
\nLong-Term Credit Bank and the Singapore branch of Japan's
\nMitsubishi Bank Limited.<\/p>\n
Hartono said the new lending facility would be used to repay
\npart of the existing loans, to finance the construction of its
\nparaffin-convert-to-olefin (PACOL) plant and to strengthen its
\ncapital structure.<\/p>\n
UIC, listed on the Jakarta and Surabaya stock exchanges, is
\nIndonesia's sole manufacturer of alkylbenzene, a raw material for
\nthe production of detergent. The company, majority owned by the
\nSayap Mas Group, Salim Group and Lautan Luas Group, sells around
\n90 percent of its production on the domestic market and exports
\nthe remainder to other Southeast Asian countries.<\/p>\n
Hartono said that the paraffin-convert-to-olefin unit, which
\nis now under construction and scheduled for completion by the end
\nof next year, will enable the company to use normal paraffin as a
\nraw material to substitute the alpha olefin, which is still
\nimported.<\/p>\n
Costs reduction<\/p>\n
"Besides being 30 percent cheaper than the alpha olefin, the
\nparaffin will be more readily available, "Hartono said. "We
\ncould, therefore, significantly reduce the production costs with
\nthe operation of the PACOL unit."<\/p>\n
He explained that UIC, which at present has a production
\ncapacity of around 150,000 tons per year, plans to build a third
\nalkylbenzene production unit early next year to increase the
\nannual production capacity to around 210,000 tons.<\/p>\n
The planned third unit will enable the company to tap the
\nrapid growth in the detergent consumption in Indonesia, he said,
\nadding that the improvement of living standards resulting from
\nthe country's steady economic growth is expected to further raise
\nthe per capita consumption of detergent, which is now merely
\naround three kilogram per annum.<\/p>\n
He added that the per capita use of detergent in Indonesia is
\nstill far lower than the approximate six kilograms in Malaysia,
\nThailand and the Philippines.<\/p>\n
"Hence, the Indonesian domestic market alone promises more
\nroom for growth," he said. (hen)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/unggul-indah-get-120m-in-loans-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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