MGTI gets $215 million loan facility
MGTI gets $215 million loan facility
The Jakarta Post, Jakarta
A group of banks led by DBS Bank in Singapore has agreed to
provide a multimillion dollar loan facility to
telecommunications company PT Mitra Global Telekomunikasi
Indonesia (MGTI) to refinance the latter's existing debts.
In a press release, DBS Bank and state-owned Bank Mandiri are
coordinating arrangers for the US$215 million, five-year loan
facility for the telecom company.
No details were available on the amount of MGTI's existing
debts.
"The fact that eight leading names in the financial community
have committed to this syndicate is testimony to the growing
confidence in Indonesia's economy and growth prospects," Brent
Smith, DBS Bank managing director and co-head of investment
banking said in the statement.
Other participating banks are ABN-AMRO, Bank Danamon, DBS Bank
Indonesia, Bank Internasional Indonesia, ING Bank and Rabobank
International Indonesia.
MGTI is developing some 730,000 telecom fixed lines in Central
Java in partnership with state-owned telecommunications firm PT
Telkom. In return, MGTI gets a 30 percent share of the revenue
for 15 years until 2010.
In September last year, all MGTI's shareholders, which include
Telkom's rival state-owned telecommunication firms PT Indonesian
Satellite Corp. (Indosat), Widya Duta Infotel, Telstra Global
Ltd, NTT Finance and Sumitomo Corporation, agreed to sell their
entire stake to PT Alberta Telecommunication (Alberta) for a
total $266. The acquisition was completed on Tuesday.
MGTI was one of Telkom's five joint operating partners in
developing telecom fixed lines in the country. But the
partnership scheme collapsed following the 1997 financial crisis.
Telkom has managed to buy out four joint-venture operations
during the past few years, but was unable to take over MGTI due
to a disagreement over valuation.
Telkom reportedly valued the company at $250 million, which
was unacceptable to MGTI shareholders.
Telkom now has to negotiate the future of MGTI with the new
shareholder, Alberta, which is a subsidiary of PT Saratoga
Investama Sedaya. Saratoga is controlled by Indonesian business
tycoon Edwin Soeryadjaya.
Saratoga has a capitalization of about $32 million in the form
of common equity and subordinated debt.