JAKARTA (TheInsiderStories) – Petrochemical producer, PT Chandra Asri Petrochemical Tbk (IDX: CAPC) and Royal Vopak N.V., the world’ independent tank storage company from Netherland, have establishes a joint venture company in Cilegon, Banten to explore Indonesian market. Both companies aims to develop tank and jetty businesses in the country.
President Director of the issuer, Erwin Saputra, stated: “We look forward to productive discussions with Vopak to jointly explore the growth of our existing jetty and tank farm operations.”
First, he said, the company aimed to develop a new jetty and tank farm business to serve new third party customers. Second, to prepare an investment and infrastructure development to support their second petrochemical complex.
While, Michiel Gilsing, division president for Vopak Asia & Middle East, said, “We are very pleased to partner with Chandra Asri, to explore opportunities in this industrial infrastructure service. We believe in Indonesia’ long-term growth potential and the potential for this collaboration will allow us to invest further in Indonesia which has been designated as one of our focus areas for growth.”
Currently, Vopak jointly owns and operates one oil terminal in Jakarta (49 percent ownership) and one chemical terminal in Merak, Banten (95 percent ownership).
In August, Ciputra has mentioned, seeking a strategic partner to build a mega project, new polyethylene plant Chandra Asri Perkasa. The projects is estimating need an investments up to US$5 billion.
According to the director, Suryandi, a final investment decision is scheduled for 2022. As a planned, the projects to be built on an area of 200 hectares (ha) in Cilegon, Banten. The second factory which was carried out in stages with target by 2025 will be completed.
To meet the investment needs, the issuer belonging to tycoon, Prajogo Pangestu, have plans to issue a new shares with private placement scheme. The rights issue planned has received and approval from shareholders in February 2020.
Suryandi explained, the company aimed to increase the production capacity of a Methyl Tert-Butyl Ether to 127,000 tons per year and a Butene-1 with a capacity of 43,000 tons per year. Both factories its expecting done in the third quarter of this year. The producer has disbursed around $70 million for the projects, he adds.
Currently, Chandra Asri is in process to issue lolca bonds around Rp1 trillion ($68.96 million) for business expansion. The bonds consist of Series A, B, and C with maturities of 3, 5 and 7 years and is targeting listing in the bourse on August 27.
The issuer has appointed PT BCA Sekuritas and PT Mandiri Sekuritas as joint lead underwriters. Fransiskus Ruly Irawan, director of the company, revealed that the fresh funding to support this year’ capital expenditure.
Last year, President Joko Widodo has inaugurated the new polyethylene plant owned by Chandra Asri. The producer spent $380 million to build the factory with total capacity production 400,000 tons per annum. With the addition of the new plant, the capacity production of the company increases to 736 thousand tons a year.
The unit of PT Barito Pacific Tbk (IDX: BRPT) just released its unaudited financial statements for the first semester of 2020. Its reported the company experienced loss $29.9 million until June 30, a 189.7 percent lower than last year booked a profit $33.3 million. The reduction of naphtha prices and crude oil price had become the triggered, said Suryandi.
Even loss, he assured assured that the balance sheet position of Chandra Asri remains strong with an increase in liquidity of $931 million as of June 30, including $649 million in cash and cash equivalents.
“Overall demand remains healthy and we expect a significant recovery in the second half of 2020, with a significant rebound since the trough phase of the petrochemical industry in the first quarter of 2020,” he explained.
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