IndoRama to issue Rp 1t in bonds

JAKARTA (JP): PT IndoRama Synthetics TBk, a publicly listed polyester producer, will issue Rp 1 trillion (about US$95 million) in bonds on to the local market later this month to secure funds to repay its short-term debts.

The company's vice president, S.P. Lohia, said on Tuesday that about $80 million of the proceeds from the bonds would be used to pay part of a syndicated loan, while the remaining $15 million would be used to strengthen the company's working capital.

He said that the five-year bonds would be offered to the public between April 30 and May 2.

"We're confident of getting a good response from the public," he told a news conference. He added that local rating agency PT Pemeringkat Efek Indonesia (Pefindo) had assigned an A+ rating to the bonds, with a stable outlook.

"The rating reflects the company's ability to repay its debts," the company's financial director, R. Chandrasekaran, said.

The bonds, which will also be listed on the Surabaya Stock Exchange on May 14, will be issued in two different forms: Series A and Series B.

Series A will carry a fixed interest rate of between 18.25 percent and 19.50 percent per annum. The interest rate of Series B will be fixed at between 18.25 percent and 19.50 percent during the first year, and three percentage points above the average deposit rates offered by major local banks during the remaining four years.

PT Deutsche Securities Indonesia, state-owned securities company PT Danareksa Sekuritas and PT ABN Amro Asia Securities will co-underwrite the bond offering

Lohia also said that the company's net profit increased 900 percent to $20 million last year from $2 million in 1999 due to a sharp increase in nonoperating income.

The company's total sales rose by 18 percent to $339 million in 2000 from $286 million in the previous year. The company's exports last year reached a total worth of $207 million, which were mainly to Europe and the U.S., he said.

IndoRama, which is listed on the Jakarta and Surabaya stock exchanges, is 41.66 percent owned by the public, 37.81 percent by PT Irama Unggul, 13.19 percent by Indorama International Finance Plc. and 7.34 percent by World Bank subsidiary International Finance Corporation. (05)