PT Polypet receives syndicated loans of $125m

PT Polypet receives syndicated loans of $125m

JAKARTA (JP): PT Polypet Karyapersada, a Napan Group
subsidiary producing polyethylene terephthalate, yesterday
received syndicated loans of US$125 million from 14 international
and domestic banks.

The loans were arranged by Chase Manhattan South East Asia
Ltd., American Express Bank Ltd. and Citicorp International
Limited.

"The interest rate on the loans was set at 1.875 points above
the Singapore Inter-bank Offered Rates (SIBOR)," the president of
Polypet Karyapersada, Wilson Pribadi, said before signing the
loan agreement here.

He said 80 percent of the money would be used to finance the
expansion of the company's production and repay existing loans,
while the remaining 20 percent will go towards strengthening the
company's working capital.

"Under our expansion program, we will increase our production
capacity by 30 percent to 78,500 tons per annum from 60,000 tons
at present," he said.

Polypet Karyapersada produces polyethylene terephthalate:
bottle-grade resins, industrial yarn-grade resins and film-grade
resins, at its plant in Cilegon, West Java.

Polypet Karyapersada currently exports 90 percent of its
bottle-grade resins to Europe and Australia and sells the
remainder to Napan Group companies.

"We sell only 10 percent of our production on the domestic
market because our products are relatively new to the Indonesian
industry," Wilson said.

Bottle-grade resins are used in the manufacture of plastic
bottles.

Wilson said that Indonesia's total output of bottle-grade
resins is estimated at 160,000 tons per annum, produced by three
firms -- PT Indorama, Bakrie Group and Polypet Karyapersada,
while domestic demand is only about 40,000 tons per annum.

He added that his company imports 50 percent of its raw
materials -- purified terephthalate acids -- from South Korea and
Taiwan. The remaining raw materials are supplied by Pertamina.

He said he was convinced that domestic demand will improve.

Polypet Karyapersada started commercial production last year.
(kod)