Lonsum gets $197m loan

JAKARTA (JP): A diversified plantation firm, PT London Sumatra Indonesia (Lonsum), Wednesday signed the completion of syndication of US$197 million term loan facilities established for the company and PT Pan London Sumatra Plantation.

The company said in a statement that the Hongkong Bank & Shanghai Banking Corporation Ltd and the Union Bank of Switzerland were appointed as the arranger and lead manager of the loan syndication.

The rate was set at 1.75 points above the Singapore Inter-bank Offered Rate.

The loan will be used partly to finance the development of Lonsum's 38,000 hectare palm oil and rubber plantation in South Sumatra, which is expected to cost Rp 347 billion (US$148 million).

Part of the funds will also be used to repay Lonsum's outstanding debt, incurred when the company was bought from Harrison and Crossfield in 1994. (alo)