JAKARTA (TheInsiderStories) – PT Pelabuhan Indonesia III, also known Pelindo III, has successfully raised US$500 million from selling global bonds on Wednesday (25/04), which proceeds will be used to help fund several projects under development.
The bond has 5-year tenor with maturity date on May 2, 2023. It carries an annual 4.5 percent interest rate. The bond received two times orders of the total offering, despite of high volatility in the global market.
This year’s bond sale marks the company’s return to global bond market after in 2014, it successfully raised $500 million from selling a 10-year global bond that carried a 4.875 percent coupon rate.
ANZ, Credit Suisse and Standard Chartered were appointed as the arranger on the latest global bond issuance. Meanwhile, PT BNI Securities and Mitsubishi UFJ Financial Group of Japan acted as co-arranger.
According to I Gusti Ngurah Askhara Dhanadiputra, the CEO of Pelindo III, proceeds from the bond sale will be used to finance port-related projects the company is working on. He said some of the proceeds will go to fund development of ports in Benoa, Bali and Mataram on the island of Lombok.
The state owned port operator will also use some to help finance a project to build an overpass road, a container terminal in Lamong Bay and toll roads nearby the terminal. The company to spent Rp 4.68 trillion ($ 339.13 million) to develop its terminals and ports.
There are also some parts of the proceeds that will go to finance the company’s capital expenditures, which is set Rp7.25 trillion. In addition, the state-owned company will also use the proceeds to refinance Rp 4.39 trillion worth of debt and fund other corporate actions, including to buy shares of private companies.
The company’s capital expenditure is allocated for a number of strategic programs, including for construction of the first phase of development of West Kalibaru Terminal, a revitalization program on the flow and the beautification of facilities at Benoa Port, and construction of Cruise Terminals and Containers at Gilimas Lombok. There are also a project to construct flyovers and tapper of the Outer Ring Road West (JLLB) Lamong Bay terminal.
International rating agency Moody’s gives Baa3 with a stable outlook, while fellow global rating assessor Fitch gave BBB- with a stable outlook for the company’s corporate ratings. The ratings are based on a number of company performance indicators that show a positive outlook.
In 2017, the company posted a record profit of Rp 2.04 trillion, which is an increased of 35 percent compared to 2016. Another positive performance is the company expects a higher ship visits from ports it operates, it also sees higher flow of goods and containers, as well as passengers throughout 2017.
“The number of ships and goods has grown by 20 percent compared to last year,” said Ari.
Pelindo III is engaged in port services. The company manages 43 ports in seven provinces, namely East Java, Central Java, South Kalimantan, Central Kalimantan, Bali, West Nusa Tenggara and East Nusa Tenggara. It controls 23 subsidiaries and affiliates.
Pelindo III’s core business is in the port service industry, which is vital for the continuity and smoothness of sea freight in Indonesia.