Sampoerna to pay 10.75% on bonds

Sampoerna to pay 10.75% on bonds

JAKARTA: PT H.M. Sampoerna, Indonesia's biggest publicly traded cigarette maker, will pay a coupon of 10.75 percent on the Rp 1 trillion (US$109.4 million) of bonds it is selling this month.

"There has been a good response" for the five-year debt, said Mandeep Singh, head of investment banking and markets at HSBC Holdings Plc's Jakarta-based unit, HSBC Indonesia. He declined to elaborate. HSBC is arranging the sale with ABN Amro Bank NV and PT Mandiri Sekuritas in Jakarta.

The Surabaya, East Java-based Sampoerna on Sept. 28 said the bonds would probably have a coupon of between 10.59 percent and 10.84 percent. Five-year U.S. Treasuries yield 3.30 percent.

Proceeds from the sale will be used to repay bonds maturing in 2005. Sampoerna sold Rp 1 trillion of five-year bonds in January 2000. The 17.5 percent security will mature on Jan. 28.

The company's local-currency bonds are rated B+ by Standard & Poor's, a junk grade, or high-risk, high-yield, designation. -- AP