PT Argo Pantes aims to raise working capital

JAKARTA (JP): Publicly listed integrated textile company PT Argo Pantes will use US$30 million in floating rate notes issued by its subsidiary, Argo Pantes Finance BV, in Hong Kong Thursday, to strengthen its working capital, a company director said here yesterday.

Argo Pantes Finance Director Wira Tjendana said the company would continue to improve its efficiency, among other things, by amortizing high-interest debts and replacing them with cheaper loan funds.

The three-year notes, issued under the borrower's $250 million medium-term note program, are to float at 150 basis points over the six-month London Interbank Offered Rate.

Sanwa International Finance acted as the arranger and lead manager of the issue with American Express Bank, Bank Negara Indonesia and Daiwa Securities as co-lead managers.

"We are highly confident that this efficiency drive will enable us to achieve our sales target of Rp 500 billion ($204.5 million) this year and net earnings of Rp 30 billion," Wira said.

He said Argo Pantes, a Manunggal group unit, had booked Rp 228.5 billion in sales turnover in the first half this year, up 10 percent from the same period last year.

Wira said that sales were usually much higher in the second half.

"Given greater efficiency and the 30 percent expansion in our capacity, as a result of the machinery restructuring which was started last year, the sales and profit targets are quite feasible," he added.

Argo Pantes exports 70 percent of its products to 40 countries.(vin)