Astra obtains loans from foreign banks

The Jakarta Post, Jakarta

Publicly listed PT Astra International, the country's largest automotive distributor and assembler, announced on Friday it had signed a facility with foreign lenders to help refinance the company's debts and for working capital.

The company has signed a dual-currency revolving credit facility worth US$170 million and Rp 600 billion (US$65 million) with a syndicated bank consisting of 16 foreign-based lenders. This is the company's first offshore loans since the late 1990s economic crisis.

"This new syndicated loan will release Astra from its existing restructured debt together with all the assets currently being pledged. The facilities are another breakthrough for Astra that confirms the company's emergence from the crisis," Astra finance director John Slack said in a statement.

According to the company, the facilities were $50 million more than what was initially on offer, and the size could have been easily doubled had Astra so desired and not reduced the commitments from the banks.

Proceeds from the facility will be used to refinance the company's existing borrowings and to meet general corporate funding requirements.

At present, Astra has a debt amounting $125 million, with a maturing period on June 30. Under the terms of Astra's loan agreement, the company has agreed to refinance its debts before they mature.

The facilities, the first offshore loans for Astra since the Asian financial crisis in late 1997, have a tenor of three years and carry an interest rate of 2.50 percent per annum over the Singapore Interbank Offered Rate, or also known as SIBOR.

ABN AMRO Bank N.V., BNP Paribas, Citigroup Global Markets Asia Limited, The Hongkong and Shanghai Banking Corporation Limited, Standard Chartered Bank and Sumitomo Mitsui Banking Corporation acted as co-arrangers and underwriters for this transaction.

The 10 other participating banks in the transaction include Mizuho Corporate Asia (HK) Ltd, Overseas Chinese Banking Corporation Ltd, United Overseas Bank Ltd, HVB Corporates & Markets, DBS Bank, Standard Bank Asia Ltd, Bumiputra-Commerce Bank Bhd, Chinatrust Commercial Bank, Industrial and Commercial Bank of China and UFJ Bank.

Singapore's Jardine Cycle & Carriage Ltd. owns 41.9 percent of Astra.

Astra shares ended higher by Rp 300 to Rp 8,150 on the Jakarta Stock Exchange on Friday.