Daily Business Briefing – Nov. 14

JAKARTA (TheInsiderStories) – Good Morning. We provide several important news items that might help your business decisions today, as follows:

Indonesia, China Sign MoUs To Boost Investment in Energy

Indonesia Energy and Mineral Resources Minister Ignasius Jonan and his China counterpart, the Administrator National Energy Administration (NEA) Nur Bekri signed memorandum of understanding (MoU), aiming at improving cooperation and investment in the energy and mineral resources. The Energy Forum was attended by 96 companies from China and 40 from Indonesia. The Chinese companies took part in the development of 35 GW mega power plants program also downstream mineral and coal.

Saudi Arabian Alfanas, Pindad Prepares a JV in Indonesia

Saudi Arabian electric manufacturer Alfanar Company  and state-owned weapon manufacturer PT Pindad signed memorandum of understanding to prepare a joint venture, said the president director Abraham Mose last week. He stated the products include low and medium voltage switch gears that state-owned electricity producer PT Perusahaan Listrik Negara has been importing. He explained that Pindad prepares up to Rp 68 billion investment funds to build a facility, among others.

Chinese Firm Eyeing Bontang Refinery

Energy and Mineral Resources Minister Ignasius Jonan revealed on Monday (13/11) that a Chinese company is in talks with state-owned energy company PT Pertamina about the Bontang refinery project. Bontang fuel refinery is a new refinery project with production capacity of 300,000 barrels per day. The refinery will be built alongside a petrochemical complex, targeted for completion in 2024.

Sawit Sumbermas Issuing US$300M Global Bonds

Indonesia palm oil producer PT Sawit Sumbermas Sarana (IDX:SMSS) is issuing global bonds worth US$300 million to refinance its debts. The company has appointed BNP Paribas and Citiare as joint bookrunners, while CIMB as joint lead manager. They have begun marketing the five non call three years notes at the 7.25 percent coupon rae. The proceeds will be used for repayment of bank facilities and general corporate purposes. Up to $10 milliom will be use for investing in forest conservation, will be managed by The Forest Trust. This senior notes will be issued by wholly owned subsidiary SMSS Plantation Holding and guaranteed by the parent company, as well as Citra Boneo Indah (CBI). Sawit Sumbermas has annual production of 340.000 tons of crude palm oil.

Wika Gedung, PP Presisi to Launch IPO, Tone Down Funds Target

PT Wika Gedung, a subsidiary of state owned PT Wijaya Karya Tbk (IDX:WIKA) and PP Presisi, a subsidiary of PT PP (IDX:PTPP) are likely to undertake lower-bound IPOs, expecting to reap only around Rp 1 trillion ($74 million) in fresh capital, Mandiri Sekuritas said. Mandiri Sekuritas will be the underwriter for Wika Gedung’s and PP Presisi’s IPOs.

PP Presisi will set an IPO price of between Rp 340 and Rp 550 per share, while looking to sell a total of 4.23 billion new shares — 35 percent of its total equity. The company expects to raise around Rp 1.43 trillion in fresh funding — below the company’s initial target of Rp 3 trillion. Meanwhile Wika Gedung, a unit of state-controlled Wijaya Karya, meanwhile plans to offer an IPO price of Rp 290 to Rp 456 per share and looks to sell a total 4.46 billion new shares, 40 per cent of its equity. Wika wants to raise Rp 1.29 trillion to Rp 2.03 trillion in fresh funding. The company had previously set an IPO target of around Rp 3 trillion to Rp 5 trillion. (*)

BRI Acquires 3% Bahana Artha Ventura Shares

PT Bank Rakyat Indonesia Tbk (IDX:BBRI) is aquiring 35 percent shares of PT Bahana Artha Ventura (BAV). The acquisition, which is done through private placement scheme, is scheduled to be completed by the end of this month. Private placement deal was signed on Nov. 9, 2017. BAV is expected to aid BRI in channeling loans to BAV customers, in particularly to SMEs.