JAKARTA (TheInsiderStories) – Indonesia’s private company providing infrastructure financing and advisory services PT Indonesia Infrastructure Finance (IIF) plans to issue a bond of Rp1.5 trillion (US$107.14 million) in 2020. It is part of sustainable bonds of Rp3 trillion, said the management to the media on Thursday (12/19).
Its CEO Reynaldi Hemarnsjah said that the firm has listed part one of the sustainable bonds in the bourse. The value of the bond is Rp1.5 trillion and issued by three series. Series A is issued with a value of Rp965 billion and an interest rate of 6.75 percent. While series B is issued with an interest rate of 7.75 percent and the value of Rp372 billion. Then series C which has a 7.9 percent interest rate is issued with a value of Rp163 billion.
Hemarnsjah asserted the firm will use the fund from bond issuance to finance infrastructure. The firm which is a unit of PT Sarana Multi Infrastruktur focuses on the financing toll road, renewable energy and water.
“In toll road, we finance Trans Java toll road and city toll roads,” he adds.
This year, the firm targets to disburse financing of around Rp10-11 trillion. While, next year, the financing is estimated to reach Rp14.5 trillion. The firm plans to finance hospitals and schools next year.
“We plan to finance around two or three hospitals in Java and Sumatera,” he said.
Previously, IIF provided Cash Deficiency Support of Rp600 million to PT Waskita Toll Road (WTR). This facility will be used to support the development of Pemalang – Batang toll road in Central Java.
The facility has a period of 18.5 years since the signing date or five years from the repayment date and has a grace period of 13.5 years. Hermansjah said, this facility allowed toll road operators to meet the cash requirements for new toll road sections that are operating.
The Pemalang – Batang toll road crosses three regencies in Central Java and is part of the Trans Java Line, that connects the Pejagan – Pemalang Toll Road and the Batang – Semarang Toll Road. The operation of the toll road is expected to ease the traffic burden on the north coast of Java, speed up the logistics supply chain, and support the development of Central Java tourism.
Earlier, The Asian Development Bank (ADB) approved a $100 million financial intermediary loan to Indonesia, to help catalyze private sector investments in infrastructure projects.
“The loan will help mobilize private sector investments to develop and finance much-needed infrastructure projects,” said ADB Country Director for Indonesia Winfried F. Wicklein.
IFF’s gap remains significant, with annual investment needs estimated to be more than $70 billion, said the Bank. Accelerating infrastructure development is a development priority of the Indonesian government.
Under the Leveraging Private Infrastructure Investment Project, the government will lend the ADB loan proceeds to IIF and Sarana Multi Infrastruktur. Both companies are important institutions in Indonesia’s infrastructure financing landscape, that provide project finance, advisory services, guarantees, and project development support to infrastructure projects.
With ADB’s assistance, IIF will lend at commercial terms to infrastructure projects adhering to the institution’ and ADB’ standards and guidelines. The loan will support projects in health, renewable energy, telecommunication, and transportation sectors.
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