Excelcomindo repays foreign debt

The Jakarta Post, Jakarta

Cellular phone operator PT Excelcomindo Pratama announced Friday it had repaid some US$70 million of its debts to foreign creditors, by using half of the proceeds raised from the recent bond issue.

The company said that with the payment, which was made on Monday, its debts would be reduced to $299.4 million.

Excelcomindo, the country's third largest cellular operator controlling about 16 percent of the market share, in October issued bonds worth Rp 1.25 trillion (about $148 million). In addition to repaying foreign debt, the company used some of the proceeds to finance the expansion of its telecom network and sales distribution network.

The company is 60 percent owned by PT Telekomindo Primabhakti (a unit of the Rajawali business group), 23 percent owned by Verizon Communications, 13 percent by Asian Infrastructure Fund and 4 percent by Mitsui of Japan.

There have been reports that Excelcomindo, which has around 2.7 million customers, has become an acquisition target of foreign telecom firms, such as China Telecom and Telekom Malaysia.

The foreign firms are keen to use Excelcomindo as a vehicle to benefit from Indonesia's huge telecom market. Out of the country's more than 220 million population, only around 20 percent to 30 percent have subscribed cellular services. This year, the number of cellular phone customers is estimated to reach 16 million to 17 million, while next year it is predicted to jump to 30 million.

The largest player in the Industry is PT Telkomsel, which is now controlled by Singapore Telecommunications.

Another Singapore company called ST Telemedia has also acquired telecommunications firm PT Indosat.