Risjad Brasali issues convertible bonds

Risjad Brasali issues convertible bonds

JAKARTA (JP): PT Risjad Brasali Styrindo -- producer of acrylonitrile butadine styrene (ABS), styrene acrylonitrile (SAN) and expandable polystyrene (EPS) -- issued mandatory convertible bonds worth US$25 million yesterday.

The bonds will have a coupon rate of one percent per annum and will mature in 2002.

"Of the funds generated from the bond issuance, $8 million will be used to finance the company's expansion, while the remaining $17 million will be allocated for the payment of the existing loan," the company's general manager, Prawiranegara Sugito, said after yesterday's signing ceremony at the Mercantile Athletic Club here.

Executives from five multinational corporations -- HSBC Private Equity Fund L.P., Wardley Asia Pacific Investment Limited, Peregrine Indonesia Fund Limited, Soros Capital Indonesia Limited and Search Direct Investment Limited -- signed the agreements to subscribe the bonds at the ceremony.

The bonds can be converted to Risjad Brasali Styrindo shares when it goes public in 1999.

The shares of the company are now 50 percent owned by businessman Ibrahim Risjad and the rest by the Brasali Group.

Risjad Brasali Styrindo, located in Serang, West Java, has an annual production capacity of 20,000 tons of SAN, 15,000 tons of EPS and 13,000 tons of ABS.

"The production capacity of ABS will be raised to 18,000 tons per annum to meet increasing demand," said Prawiranegara..

He said his company procures styrene as a feedstock from PT Styrene Mono Indonesia.

ABS and SAN are used in the manufacturing of heat and chemical resistant plastic components for electronics, household appliances, automotive components and certain grades of pipes, while EPS is used to produce packaging and building materials as well as cold storage insulation.

Seventy percent of the company's production is marketed domestically, while the rest is exported to Hong Kong.(kod)