Bakrie Pipe gets $80 million loan

Bakrie Pipe gets $80 million loan

JAKARTA (JP): Steel pipe maker PT Bakrie Pipe Industries, a
subsidiary of PT Bakrie and Brothers, has secured a US$80 million
syndicated loan from local and foreign finance companies to
refinance its foreign debts.

The company signed a five-year loan Saturday in Bali, with
Bank Bira as the loan's lead arranger.

The syndication consists of Bank Bira, Bank Austria, American
Express Bank, Arab Banking Corporation, Fuji Bank, Sakura Bank,
Sanwa Bank, Sumitomo Bank, Royal Bank of Scotland, ING Barings
and Bapindo.

The loan has a yearly interest rate of 1.60 percent above the
Singapore Interbank Offered Rate (Sibor).

"The loan will be repaid in installments for five years, so
the company will not be burdened with an inflated dollar rate
when repaying the loan," the company said.

The company said the prices of its products were quoted in
dollars and parent company PT Bakrie and Brothers had also hedged
about 94 percent of its foreign loans.

The loans will be used to refinance existing loans made to
increase the production capacity of its electric-resistant welded
steel pipe to 300,000 tons a year from 80,000 tons.

The company claims to lead the market in the sales of the
electric-resistant welded pipes and exports some 10 percent of
its production to Asian countries.

PT Bakrie Pipe, which has a manufacturing plant in Bekasi,
West Java, sells steel pipes to businesses in the oil and gas,
telecommunications, drinking water, property and construction
sectors. (das)