CMNP to issue Rp 1t bonds
CMNP to issue Rp 1t bonds
Dadan Wijaksana, The Jakarta Post, Jakarta
Toll road operator and builder PT Citra Marga Nusaphala Persada
(CMNP) plans to issue Rp 1 trillion (US$108 million) worth of
rupiah-dominated bonds in the first semester of next year to
support the company's business expansion plans.
CMNP president Daddy Haryadi told reporters on Wednesday at a
seminar on infrastructure that the company would need fresh funds
next year if it wanted to participate in the government's planned
massive infrastructure projects.
"We do not want to miss out on those projects, but we need to
have fresh money for that. And a bond issue is certainly an
option, perhaps about Rp 1 trillion," Daddy said.
The government has made pledges to develop infrastructure
facilities over the next five years in various business sectors
such as energy, transportation, telecommunications and so on --
all necessary to support and generate higher economic growth.
And since the financing needs would be enormous, private
participation would be required, something that both domestic and
overseas investors should take advantage of.
State Minister for National Development Planning Sri Mulyani
Indrawati said on Wednesday that the country would need about Rp
1,030 trillion in financing for the 2005-2009 period to fund the
various infrastructure projects, of which around Rp 600 trillion
would come from the private sector as the government is already
facing many constraints.
Daddy said that the government's plans should suit well with
the company's business expansion plans, saying the firm could
even look for other ways to generate fresh funds, in addition to
the bond issue.
"Funding sources for expansion could also come from our own
equity or perhaps even loans, as we know the financing for
infrastructure projects is huge," he said.
Based on rough calculations, Daddy added, it would cost about
Rp 50 billion to construct one kilometer of a toll road, meaning
that Rp 1 trillion could only finance the construction of 20 km.
Elsewhere, Daddy also said that before the company could move
ahead with its bond issue plan, it intended to clean up the
firm's debts -- in the form of dollar-dominated bonds -- by the
end of the year.
"I think we have now about $13 million worth of dollar debts
to settle. We would buy back those bonds from the creditors,
hopefully it could be completed by year-end, so it would not hold
the company up from its expansion," he said.
Formerly controlled by the eldest daughter of the country's
former president Suharto, Siti Hardiyanti Rukmana, CMNP is now
58.3 percent owned by the public.
State toll road operator PT Jasa Marga also owns a 17.8
percent stake in the company.