Indosat names advisors for debt restructuring

Indosat names advisors for debt restructuring

PT Indonesia Satellite Corp. has mandated four financial advisers to restructure the company's debt, a process that is expected to be completed by the end of the year.

Under the debt restructuring, Indosat will issue new bonds at cheaper interest rates to refinance existing debt.

The advisers are Goldman Sachs Group Inc., ING Groep N.V., Barclays Capital, and a local securities firm PT Andalan Artha Advisindo.

"Indosat's board of commissioners has named the four financial advisers for Indosat's debt restructuring plan," a deputy state enterprise minister, Roes Aryawidjaya, told Parliament in a hearing session Thursday.

Roes is also a commissioner at Indosat, the nation's second- largest telecommunications company.

Indosat plans to issue up to US$300 million in international bonds and Rp 3 trillion ($356 million) in local bonds later this year to refinance some of the $900 million debt coming due.

The company's debt load increased in 2002 when it bought PT Satelit Palapa Indonesia, or Satelindo, the nation's second- largest cellphone company. Much of Satelindo's $360 million debt is in short-term borrowings, including bonds and bank loans.

Singapore Technologies Telemedia, a Singapore government- controlled company, bought a 41.94 percent controlling stake in Indosat late last year. Indonesia's government owns a 15 percent share in Indosat.

A slew of Indonesian companies have been able to issue international bonds this year to foreign investors hungry for high-yielding assets. Indonesia's ability to get inflation under control, and bring down interest rates, has helped spark interest in Indonesian assets. -- Dow Jones