Federal Motor gets loan

Federal Motor gets loan

JAKARTA (JP): PT Federal Motor, the sole agent and
manufacturer of Honda motorcycles, obtained US$100 million in a
syndicated loan under an agreement with 23 foreign banks which
was signed in Singapore yesterday.

The three-year loan charges an annual interest rate which is
floating 1.98 percent above the Singapore inter-bank offered rate
(SIBOR). The loan will be used to refinance a previous syndicated
loan which was used by Federal Motor for importing spare parts.

Federal Motor, the country's largest motor-bike producer, is a
subsidiary of PT Astra International which is listed on the
Jakarta Stock Exchange.

Astra's Senior Manager for Public Relations Aminuddin said
yesterday that the loan syndication was 60 percent
oversubscribed, indicating strong confidence of foreign creditors
in the company.

The loan syndication was led by the Long Term Credit Bank
Ltd., Sanwa Bank Ltd. and Sumitomo Bank Ltd. Twenty other banks
in Singapore participated in the syndication.

Aminuddin quoted financial analysts in Singapore as saying
that the terms of the loan were among the best obtained by an
Indonesian private company in Singapore.

The loan, for example, is secured not by Federal Motor's fixed
assets but by its account receivables and inventories, he said.

Also present at the signing of the loan agreement in Singapore
were Astra's President T.P. Rachmat and Financial Director Rini
M.S. Soewandi and Federal Motor's President Budi Setiadharma.
(vin)