JAKARTA (TheInsiderStories) – Indonesia’ petrochemical producer, PT Chandra Asri Petrochemical Tbk (IDX: TPIA) seeks strategic partner to build a mega project, new polyethylene plant Chandra Asri Perkasa, said the management on Wednesday (08/05). 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 January, the chemical producer offered a third phase sustainable bond in 2020 with a total amount of Rp750 billion and have a fixed interest rate 8.7 percent per annum. In 2018, the company has offered the first phase of bonds amounting to Rp500 billion, followed by the second phase worth Rp750 billion in 2019.
Last January, the chemical producer offered a third phase sustainable bond in 2020 with a total amount of Rp750 billion an has an interest 8.7 percent per year. Earlier, the publicly listed firm considered to release as much as 7.17 billion shares this year, but no further detail the target funds from the rights issue.
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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