JAKARTA (TheInsiderStories) - National flight carrier, PT Garuda Indonesia Tbk (IDX: GIAA), has received worth of Rp1 trillion (US$70.92 million) from PT Sarana Multi Infrastruktur (SMI), the state firm under finance ministry, as an executor of the investment. The fresh funding is part of National Economic Recovery Program (ERP) for the state-owned enterprises (SOEs).
To raise the funds, the issuer will publish a mandatory convertible bonds (MCB) with a total value of Rp8.5 trillion in stages. According to the CEO, Irfan Setiaputra, the first stage of MCB has three years of tenure and will be converted into shares after the maturity end.
The capital injection has been regulated through the minister of finance decree Number 118/PMK.06/2020 concerning the government investment through ERP program. SMI will act as the executor of the funding distribution to the SOEs and other institutions.
Setiaputra stated, that all the MCBs will be converted in seven years period until 2027 into share ownership through the private placement mechanism. Based on the initial prospectus, the notes will be executed at Rp206 a share, determined of 90 percent of the average closing price of for 25 consecutive days from Oct. 13.
The number of shares to be issued is 41.26 billion shares and the series B shares and will diluting 61 percent decrease in ownership. He said, the funds were used to restore Garuda‘ financial condition amid the pandemic. This also considers the role of the company in the connectivity of the flow of goods and passengers, domestically and internationally.
Setiaputra revealed, with the entry of the fresh funds will increases the asset values and the company’ net working capital. Recently, the Indonesian government has lowered the dividend targets of SOEs from Rp65 trillion to Rp26.13 trillion in 2021 or down 40.34 percent of this year’ targets.
In the 2021 State Budget, the country also plans to injects new capital to the eight state companies amounting to Rp37.4 trillion. Beside Garuda, seven SOEs that received the funding are PT Sarana Multigriya Finansial Rp2.3 trillion, PT Hutama Karya Rp7.5 trillion, PT Perusahaan Listrik Negara Rp5 trillion, PT Bahana Pembagunan Usaha Indonesia Rp20 trillion, and PT PAL Indonesia Rp1.3 trillion.
Then, PT Krakatau Steel Tbk (IDX: KRAS) will also receive capital injection Rp3 trillion with a maximum tenure of seven years, PT Kereta Api Indonesia Rp. 3.5 trillion, and PT Perkebunan Nusantara Rp. 4 trillion, and Perum Perumnas Rp. 650 billion, PT Pelabuhan Indonesia III Rp1.2 trillion, PT Kawasan Industri Wijaya kusuma Rp1 trillion, and PT Indonesia Tourism Development worth of Rp500 billion.
The companies will carry out various programs such as the infrastructure development, tourism, electricity, insurance, port, and industrial estate. Finance minister, Sri Mulyani Indrawati, said the targets took into account the impact of COVID-19 on the SOEs performances.
She hopes that the decrease in the state-run firm’ profit can be compensated by the projected increase in non-tax state revenues for natural resources and oil and gas. The government projects that next year’ commodity price movements will move steadily.
US$1: Rp14,100
Written by Editorial Staff, Email: theinsiderstories@gmail.com
