PT Astra issues Euro bonds

PT Astra issues Euro bonds

JAKARTA (JP): PT Astra International, the country's largest
automaker, announced yesterday that it has issued US$200 million
of Euro bonds through its subsidiary, Astra Overseas Finance
B.V., on the Luxembourg Stock Exchange.

Legal documents of the bonds issuance will be signed here
today by Astra as the issuer and guarantor, and ING Barings and
SBC Warburg as lead managers.

Astra said yesterday that the bonds have a tenure of seven
years with a fixed interest rate of 8.75 percent per annum.

Astra's president TP Rachmat said that 60 percent of the total
proceeds will be used to refinance Astra's short-term debts. No
details were available for the remaining 40 percent.

Rachmat did not explain whether the bonds, which were issued
on July 11, were fully subscribed or not.

He, however, said "We got a positive response from foreign
investors when we conducted a road show to several major cities
including Tokyo, Seoul, London, Frankfurt and New York."

Commenting on Astra's performance, Rachmat said "We realized
that competition in the auto market is going to be very tight
this year but we will try to boost the company's sales and
profit, or at least not to let them drop below last year's
figures."

He also estimated that domestic car sales will drop by 10 to
15 percent this year due to buyers's wait-and-see attitude
related to the upcoming entry of new cars, claimed to be the
cheapest sedans ever to be sold in the country.

"But it's only temporary. I'm optimistic that starting from
next year, car sales will grow very fast," he said. "We are also
optimistic that we can sell up to 600,000 cars per annum before
the year 2000."

"It's true that competition is tough but automotive business
is till promising. And Astra will try to maintain its market
share," Rachmat added.

He said that in the first six months of this year, Astra sold
77,266 vehicles or 50,2 percent of domestic car sales.

Astra International was founded in 1957 by William Soeyadjaya
and the late Tjia Kian Tie. It is now a major diversified
investment holding and operating company with significant
interest in a number of important sectors of the economy, mainly
in the automotive industry. (alo)