Indocement owners approve debt restructuring plan

Indocement owners approve debt restructuring plan

JAKARTA (JP): The extraordinary general shareholders meeting
of publicly listed cement producer PT Indocement Tunggal Prakarsa
approved on Friday the company's US$1.1 billion debt
restructuring plan.

Indocement's debt restructuring plan obtained the approval of
98.9 percent of the shareholders.

The meeting also approved the merger of Indocement and its
subsidiaries PT Indocement Investama and PT Indo Kodeco Cement,
with Indocement as the surviving entity.

"The shareholders' approval is prerequisite to finalizing the
debt restructuring deal," Indocement investor relations manager
Sahat Panggabean said.

Under the debt restructuring deal, the company would
reschedule its $1.1 billion debt over eight years, with a two-
year grace period, Indocement said.

For debts in US dollars, the interest rate will be set at two
percentage points above the London Inter-Bank offered rate.

As for rupiah debts, the interest rate has been set at two
percentage points above the average six-month time deposit rate
of state banks.

The debt restructuring scheme has received 99.7 percent
approval from Indocement's creditors.

Sahat, however, fell short of naming the creditors, saying
only that Bank of America headed the creditors' steering
committee and that Japan's Marubeni was Indocement's biggest
creditor.

"The debt restructuring scheme also includes a debt-to-equity
deal with Marubeni," Sahat said.

He said Marubeni would convert part of its loans, or $26.21
million, into Indocement equity.

According to Indocement, its creditors are still preparing the
documents, but it expects a final agreement later this month.

"Merging Investama and IKC is another part of the debt
restructuring deal," Sahat said.

He also said the German-based cement company Heidelberger
Zement A.G. was set to acquire a stake in Indocement.

Heidelberger will buy out part of Indocement's debts and
convert them into shares later, he said.

Heidelberger, Sahat added, was waiting for Indocement to
conduct a rights issue before taking this step.

"We must hold another shareholders meeting to approve the
entrance of Heidelberger. We expect the meeting to be held by
December," Sahat said.

Indocement shareholders appointed on Friday Mahmuddin Yasin as
the company's new commissioner, without changing the current
board of commissioners.(bkm)