Satelindo gets $230m loan from U.S. bank

Satelindo gets $230m loan from U.S. bank

JAKARTA (JP): Private telecommunications provider PT Satelindo
has secured a loan of US$230 million from the Export Import Bank
of the United States to expand its operations.

Satelindo president Iwa Sewaka said on Tuesday that the
company would receive the funds gradually, as required by its
business expansion programs.

"We decided to seek the loan after canceling our plan to issue
debt instruments to generate additional funds required to finance
our expansion project," he said.

Iwa said in June that, before the end of this year, Satelindo
would issue debt instruments worth some $500 million to support
its expansion and to prepare itself to enter overseas stock
markets.

He said yesterday that, because many telecommunications firms,
including the state-owned PT Telkom, had recently launched public
offerings on the international stock market, Satelindo might not
issue debt instruments or shares until the end of next year.

Satelindo is 45 percent owned by PT Bimagraha Telekomindo,
22.5 percent by Telkom, 7.5 percent by PT Indosat and 25 percent
by DeTeMobil of Germany. Satelindo raised $586 million in March
from the sale of a 25-percent stake to DeTeMobil.

Satelindo, established in 1993, runs a global system for
mobile (GSM) communication network and international
telecommunications using the Palapa-C satellites.

According to Iwa, the U.S. Export Import Bank has already
extended $100 million to his company for the launching of Palapa-
C1 from Cape Canaveral in the U.S. in January next year.

"The additional loan from the Export Import Bank will range
between $50 million and $230 million with a maturity of seven to
nine years," he said, adding that Germany's KfW and France's
Paribas had also agreed to extend loans to the company.

He said that Satelindo's operating investments were likely to
reach $800 million by 1998. "The investment will double to $1.6
billion within the following five years," he added.

He said that, as part of its business expansion, Satelindo
will install 550,000 new GSM telephone lines, starting in 1996,
with an investment of $250 million.

Satelindo has so far installed some 300,000 GSM lines, while
the number of its subscribers is only 80,000 at present.

"We will add several gateways to improve our international
call service. We also consider participating in regional
telecommunications projects by acquiring shares of certain
telecommunications firms or setting up joint operations," Iwa
said. (icn)