Indonesia’s Express Private Placement of US$29M to Pay Debts

A taxi operator owned by the Rajawali Corpora, PT Express Transindo Utama Tbk (IDX: TAXI) to hold a private placement with targets Rp407.8 billion (US$29.13 million) - Photo by the Company

JAKARTA (TheInsiderStories) – A taxi operator owned by the Rajawali Corpora, PT Express Transindo Utama Tbk (IDX: TAXI) to hold a private placement with targets Rp407.8 billion (US$29.13 million), said the company today. All the proceeds will be use to convert the matured bonds on Dec. 31, 2020.

According to the president director, Johannes Triatmojo, the issuer to offer 4.07 billion shares with an exercise price of Rp100 a share. As planned, the private placement will be carried out on Jan. 18, 2021 and the results of the private placement will be announced on Jan. 20, 2021.

The parties who take the shares are all Express mandatory convertible bond (MCB) holders in 2019. Before the prgram, the company has carried out an amortization of MCB from the initial principal amount Rp466.12 billion to Rp 407.8 billion.

The firm controlled by local tycoon Peter Sondakh then paid an amortization of Rp58.29 billion by selling the collateral bond assets. Then, from July 2, 2019 to Jan. 5, 2021, the company has carried out seven amortization with a total value of Rp192.19 billion. These convertible bonds have a total value of Rp 1 trillion.

The first phase is Rp400 billion which is converted into shares through a private placement. Then the second stage of Rp600 billion is amortized through the sale of fixed assets. In addition to the mounting debt bondage, Express‘ businesses is also pressured by the spread of the COVID-19.

The company, which has been operating commercially since April 1989, has experienced a halt and restriction of the company’s operations since the spread of the deadly virus, especially regular taxis, premiums, vehicle rental and limousine services, and stopping operations on bus rental services in the Greater Jakarta.

Express has received a summons for the Debt Payment Obligation on June 30, 2020 regarding the request submitted by its debtor received by the Central Jakarta Commercial Court. In the midst of this pressure, Triatmojo said that his party would undertake a number of strategies to restore the company’ condition.

He revealed, the amount of its bond debt was Rp681.9 billion as of March 31, 2020. Most of the obligations were Rp549.1 billion in debt and Rp90 billion in arrears and penalties, Rp55 billion in debt tax, Rp8 billion and short-term debt, the third parties loans amounting to Rp37 billion.

Going forward, said Triatmojo, the taxi manager consistently strives for steps that have been and will be implemented in a sustainable manner, including continuing the bond debt reduction program by selling non-core and non-productive assets.

In addition, continuing cost efficiency programs and implementing strict budget policies in both operations and headquarters, through adjusting the number of employees and consolidating operations and closing a number of inactive pools.

While, the number of taxis owned by the operator has also decreased significantly to cover the company’ debt. In 2016, the company still had 10 thousand taxis and this is slowly decreasing to 9,600 in 2017, 9,300 in 2018, 7,400 in 2019 and 3,800 in 2020.

Right now, the company’ shares are held by Zico Allshores Pte. Ltd., 18.44 percent, Rajawali Corpora 17.81 percent, UOB Kay Hian Pte. Ltd., 15.13 percent, and public investors 48.62 percent.

US$1: Rp14,000

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