Jakarta (TheInsiderStories) – Indonesia’ PT Bumi Serpong Damai Tbk (IDX: BDSE) stop the tender offer of global notes amid the lower demands, said the management today (09/04). During the tender offer period on August 27 to Sept. 2, the incoming bids only reached $161.83 million.
Based on the Singapore Stock Exchange rule the issuer much get offering at least $200 million. No further information what the developer next plan to settle the debt.
In August 28, unit of Bumi Serpong Damai, Singapore-based Global Prime Capital Pte. Ltd., launched a tender offer for some of senior notes which issued in April 2018 and will mature in 2021. The company has appointed joint lead managers and book-runners namely Citigroup Global Markets Singapore Pte. Ltd., Credit Suisse (Singapore) Ltd., UBS AG Singapore branch, and Mandiri Securities Pte. Ltd to run the program.
The property developer signed the agreement with the four parties on August 27. It said, BSDE has planned to issue new senior notes with adequate amount for the refinancing plans and has get Ba3 rating from Moody’s Investor Service and from Fitch Ratings BB-. In the connection with the plan.
No further details on the value of the issuances, but the unit of Sinar Mas Group stated, the amount will not be more than 20 percent of the company’ equity. The proposed notes are guaranteed by Bumi Serpong Damai and some of its subsidiaries, and rank pari passu with the 2021 notes and 2023 notes.
At 30 June 2019, around 60 percent of the property developer’ total debt was unsecured. In addition, the majority of BSDE’ earnings and borrowings are held at the holding company, which is a guarantor to the notes.
Bumi Serpong Damai‘ Director Hermawan Wijaya said, the company followed the tender offer provisions including the conditions of funding, the results of which were not satisfactory. Thus, the company decided no notes were bought back by Global Prime Capital.
In the first semester (1H) of 2019, around 60 percent of the property developer’ total debt was unsecured. In addition, the majority of BSDE’ earnings and borrowings are held at the holding company, which is a guarantor to the notes.
According to Moody’s, the Ba3 rating reflects its established position as one of the largest property developer in Indonesia, with diversification across multiple projects and property segments. BSDE’ scale and diversification also provide the company with the flexibility to alter its product offerings and cater to changing market demand.
The company is also exposed to the volatile property sector and the evolving regulatory environment in Indonesia. The stable rating outlook reflects Moody’s expectation that the company will achieve at least Rp5 trillion ($352.11 million) of marketing sales each year and maintain financial discipline as it pursues growth.
Established in 1984, Bumi Serpong Damai is one of the largest developer listed on the Indonesia Stock Exchange by market capitalization. The company and its subsidiaries are engaged in the development, management and operation of residential townships, condominium towers, office buildings, retail malls and hotel properties.
The company is sponsored by Sinarmas Land Limited, which held an approximate 60 percent stake in the company at June 30, 2019.
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