Mayora Indah to issue Rp 300b bonds

JAKARTA (JP): Publicly listed PT Mayora Indah, a cookie, confectionery and coffee products maker, will offer Rp 300 billion (US$122.95 million) in bonds next month, to refinance debts and expand.

Mayora's president Halim Atmadja said yesterday the bonds would mature in seven years, and carry a fixed interest rate of between 14.25 percent and 14.75 percent.

"The bonds will be offered from July 7 to July 9 and will be listed on the Surabaya Stock Exchange around the middle of July," Halim said.

Peregrine Sewu Securities will underwrite the bonds.

Halim said Mayora will use 30 percent of the proceeds to refinance existing debts, 30 percent to increase its working capital and the capital of its four subsidiaries and 40 percent to expand and relocate some of its factories.

The company is working on a 10-year expansion program to increase its production capacity, he said.

"We are also planning to gradually relocate several of our factories in Tangerang, because in less than ten years there won't be any more room for expansion in the city," he said.

In the next two years, the company would relocate two of its Tangerang wafer and cookie factories to Serang, in West Java, he said.

About Rp 120 billion of the proceeds would be used to buy land and machinery for new factories, he said.

Mayora owns nine factories, six in Tangerang, and three in Cibitung (West Java), Surabaya (East Java) and Medan (North Sumatra).

Halim said he believed investors would respond well to the bonds because of the company's strong financial performance.

Indonesian credit rating agency Pefindo has assigned an "A" long-term credit rating to Mayora and its bonds.

Mayora is the only private company in the country that has been given Pefindo's "A" credit rating, he claimed.

Mayora Indah, set up in 1977, is 52.64 percent owned by PT Unita Branindo, 5.08 percent by PT Mayora Investama, and 42.28 percent by the public.

The company exports 17 percent of its products to 55 countries.

Last year, the company booked a Rp 53.14 billion in net profit, up from Rp 50.25 in 1995. Its net sales rose to Rp 342.4 billion last year, from Rp 304.83 billion in 1996.

Mayora's finance director Hermawan Lesmana said the company expected a 20 percent sales and net profit growth this year. (das)