Bali Mandar Toll Road - Photo by Waskita Karya

JAKARTA (TheInsiderStories) – A state-owned construction firm, PT Waskita Karya Tbk (IDX: WSKT) planned to issue Rp5 trillion (US$344.82 million) bond, in the second semester of 2019. The company also planned to divest part of shares at its toll road projects.

The developer is still considering whether the bond will have zero coupon or floating rate. According to the company’s Finance Director Haris Gunawan, the funding will be used for paying the old debt Rp2 trillion. He said the bonds will uses zero coupons or floating rates.

On the divestment planned, the CEO I Gusti Ngurah Putra explained, this year it is ready to sell its toll road with a divestment scheme. He ensures that as many as 18 toll roads are ready to be divested in 2019. He revealed, that Waskita entered into the toll road development business as a developer rather than being an operator.

“What needs to be considered is how to divest the toll roads that are already 100 percent complete,” Putra said in Jakarta on Friday (01/04).

Of the 18 toll roads, Gunawan added, that there are at least five minimum toll sections divested this year. “What we go to potential buying companies is as possible in Dubai, France and Hong Kong. We go directly to foreign investors,” he said.

Last year, Waskita and state-owned toll operator company PT Jasa Marga Tbk (IDX: JSMR) are planning to raise Rp8 trillion from the divestment of six Trans Java sections to investors. Both companies will used the funds to finance various new toll road projects and in addition to the issuance of private equity funds.

In the first phase of divestment, WSKT to sell Bekasi-Cawang-Kampung Melayu (Becakayu) toll road, and the second phase divestment will be selling several sections of the Trans-Java toll road, namely the Kanci-Pejagan, Pejagan-Pemalang, Pemalang-Batang, Batang-Semarang, Solo-Ngawi, Ngawi-Kertosono and Pasuruan-Probolinggo sections.

Meanwhile, JSMR is planning to divest its stake in Semarang-Batang, Ngawi-Kertasono and Solo-Ngawi toll road sections.

Indonesia’s Toll Road Regulatory Agency has offered six toll road projects with an investment value of Rp124 trillionto be auctioned gradually in the second half of 2018. The projects have length 327 kilometers.

The agency’ head Herry Trisaputra Zuna said that the auction process of the six toll roads is expected to be completed last year.

The six toll roads are Semarang-Demak along 26.80 kilometres (km) with investment value Rp15.34 trillion, Semanan-Balaraja along 31.90 km with value Rp16 trillion, Kamal-Teluknaga-Rajeg 38.60 km of Rp23.16 trillion.

In addition, the tendered project is access to the Port of Patimban along 37.70 km worth of Rp6.40 trillion, Gedebage-Tasikmalaya-Cilacap along the 184 km with an investment of Rp46.60 trillion, and the Balikpapan-Penajam Paser Utama Bridge along 7.60 km with an investment value of Rp16.50 trillion.

According to Zuna the projects, PT Penjaminan Infrastruktur Indonesia, the state-owned guarantee firm under the Ministry of Finance, is ready to guarantee the risk of the six toll road projects.

Last year, the agency has auctioned two toll road projects to investors with through availability payment scheme, in which the government will set up the quality and service standard.

The two toll roads are the Serang-Panimbang toll road section with a length of 83.9 kilometres and estimated investment of Rp11.4 trillion in Banten province and a toll road linking Samarinda and Bontang in East Kalimantan with a length of 94 km and estimated cost of Rp15 trillion.

According to Minister for Economic Affairs and Chairman of Committee Acceleration of Infrastructure Development Priorities Darmin Nasution, the toll road projects require a total investment of Rp4,800 trillion until 2019.

In the last of two years, the government has injected capital for state-owned enterprises (SOEs) Rp65.8 trillion and Rp50.4 trillion to carry out the infrastructure projects. At the same time, Minister of Public Works and People’s Housing Basuki Hadimuljono said, its unit already paid Rp14.5 trillion from total funds Rp34 trillion for land acquisition.

US$1: Rp14,500

Email: linda.silaen@theinsiderstories.com