Ricky Putra gets US$30m syndicated loan

JAKARTA (JP): Garment producer PT Ricky Putra Globalindo of the Ricky Group signed yesterday a US$30 million syndicated loan facility to refinance existing debts and strengthen its distribution division.

The company's president, Ricky Gunawan, said yesterday he was confident the loan would not burden the company despite the rupiah's continued decline against the U.S. dollar, because of the company's significant earning from exports.

"We always make sure our foreign debt is in line with our targeted exports, which contributes 30 percent to our total sales," Ricky said after the loan signing.

He said the company, manufacturer of GT underwear and other brands of clothing, would start hedging only if the loans in the dollar exceeded the targeted export value.

Ricky said the sharp increase in domestic interest rates would not greatly affect the company because loans in rupiah were relatively small.

"However, a monetary phenomenon like this would definitely affect business activity because our products are basic needs," he said.

"But I'm sure it would only be temporary," he added.

The revolving loan will be arranged by ING Barings and the Sanwa Bank in Singapore and will carry an interest rate of 1.65 percent above the Singapore Interbank Offered Rate (SIBOR).

Ten banks participated in the loan, including Standard Chartered Bank, Arab Banking corporation, Creditanstalt Bankverein, Deutsche Bank, Bank BNP Lippo Indonesia and Tokai Lippo Bank.

The rupiah has been under attack recently, after the government floated the currency. It has slipped by nearly 20 percent since then.

The rupiah recovered slightly after the central bank sharply raised its interest rate, but in the last three days plunged to almost the same value before the bank raised its interest rate.

Yesterday, the rupiah further dropped to over Rp 3,000 against the American dollar but recovered slightly in the afternoon to Rp 2,900.

Ricky said his company could obtain the syndicated loan despite the monetary upheaval, which also hit other neighboring countries because the loan had been arranged three months in advance.

Marketing Director of ING Barings in Singapore, Jan Willem Overwater, said yesterday at the signing he had confidence in Ricky Putra and believed the current situation would soon return to normal.

Ricky said 50 percent of the loan would be used to refinance its debts and the remaining 50 percent to develop its subsidiary companies throughout the country.

The company has six subsidiary companies to distribute its products in Java and Sumatra. The company produces about 9.5 million dozens of garments yearly, of which 1.2 million dozen comprises underwear.

The company's corporate finance director Victor Franziscus said yesterday his company expected its revenue to reach Rp 143 billion (US$47.66 million) this year, up from Rp 116 billion last year.

He targeted revenue would continue to rise to Rp 178 billion next year. (das)