Tire firm raises loans

Tire firm raises loans

JAKARTA (JP): PT Elangperdana Tyre Industry, a subsidiary of Elang Group, has raised a syndicated loan of US$78 million to support its export-oriented tire production.

Mohammad Yasin, an executive of the Elang Group, said here Saturday that the loan, the agreement for which was signed in Singapore on Friday, was larger than the initially proposed $77.5 million.

"We initially proposed a loan of $77.5 million but we had to raise it to $78 million to meet demand," Yasin said, adding that the signing of the loan syndication was also witnessed by the company's suppliers from Japan.

He said that the offshore loan would be used to partly finance the construction of Elangperdana's tire plant, which is scheduled for production by the end of this year.

"The tire plant will mainly produce tires for cars and trucks with an initial production capacity of between 500,000 and 750,000 tires," he said, adding that in the second year, the production capacity would be doubled to 1.5 million tires.

Yasin said Saturday that Elangperdana's tire production would be mostly directed at overseas markets, including Japan and European countries.

He said that the tire plant would use the tire processing technology of Vredestein Banden, a major tire producer in Europe. "Vredestein will, therefore, be used as the brand for Elangperdana's tires," he said. (hen)