Indonesia's Lippo Karawaci Secures Funding US$1.01B
Lippo Group through PT Inti Anugerah Pratama sold around 9.44 percent its share ownership in property developer PT Lippo Karawaci Tbk - Photo by the Company

JAKARTA (TheInsiderStories) – Lippo Group through PT Inti Anugerah Pratama sold around 9.44 percent its share ownership in property developer PT Lippo Karawaci Tbk (IDX: LPKR), its announced at Indonesia Stock Exchange on Tuesday (02/26). Currently, the Group owned 45.83 percent in its unit.

There is no further information of the total amount of the transaction and on the share sales purposes. But recently, Lippo Karawaci has debt problems and pressured on the Meikarta projects.

Last week, LPKR stock was traded with a jumbo value in the negotiation market today, precisely Rp623.8 billion (US$44.56 million). The transaction occurred by PT Credit Suisse Securities with total shares 21.8 million lots at a price of Rp286 each.

Then, the same broker 2 billion shares and 181.22 million shares respectively at the same price. In the negotiation market there is another transaction sold 12 million shares through PT Indo Capital Securities and PT Ciptadana Sekuritas Asia at a price of Rp282.

Last January, the developer divested its $19.5 million, hospital and clinic in Myanmar to Singapore’ OUE Lippo Healthcare Ltd. The healthcare has been taken from another Lippo-owned company, PT Waluya Graha Loka.

The conditional share purchase agreement signed, Jan. 10. Two unit of OUE Lippo, OUELH Healthcare Service Pte. Ltd., and OUELH healthcare Assets Pte. Ltd., will altogether absorb the hospital and clinic shares.

In 2018, OUE Pte. Ltd. has inked a deal for land acquisition in South Jakarta’s central business district. Its subsidiary PT OUE Pengembangan Property will pay Rp1.63 trillion in promissory notes to local property developer Asia Tower Sudirman for some 8,000 square meters of plots zoned for commercial use.

OUE also has signed conditional sales and purchase agreement to take over 60 percent stake in Bowsprit Capital Ltd while other unit OUE Lippo Healthcare (OUELH) will take over the remaining 40 percent stake. Bowsprit is the First REIT manager, that owns 7 percent of the first REIT for total S$99 million.

In addition, Bridgewater International Limited, LPKR’s indirect wholly owned subsidiary also signed Conditional Unit Purchase Agreement with OLH Healthcare Investments Pte. Ltd., OUELH’ indirect wholly owned subsidiary, who will acquire 10.6 percent of first REITs units held by Bridgewater for S$103 million.

Unit of the Lippo group said, following this transaction documents, LPKR’s shareholding in FIRST REITs will be reduced from 28.2 percent to 10.6 percent. Lippo Karawaci will use the proceeds mainly for general corporate purposes.

Furthermore, OUELH will launch a renounceable underwritten rights issue to raise about S$150 million to fund the acquisition, issuing about 2.2 billion new rights shares at S$0.0675 apiece on the basis of one rights share for every one existing ordinary share held by entitled shareholders as at the books closure date.

OUE and Itochu Corporation, which own 64.35 and 25.32 per cent stakes in OUELH respectively, have given irrevocable undertakings to fully subscribe for their entitlements under the rights issue.

OUE is a Singapore-based, diversified property owner, developer and operator with a real estate portfolio spanning across Asia and the United States. OUE is the sponsor of OUE Hospitality Trust and OUE Commercial REIT, established for the purpose of investing in income-producing hospitality and hospitality-related real estate, and commercial assets in financial and business hubs.

OUELH formerly known as International Healthway Corporation Limited is principally involved in development, operation and management of healthcare and related facilities in Japan and China, and seeks to expand its healthcare portfolio to pan-Asia

Recently, Lippo Karawaci is facing Meikarta project’ problem over bribery issue. Lippo Group’ top official Billy Sindoro and other officials is arrested by anti-graft commission last year.

Followed the cases, two global rating agency Standard & Poor’s and Fitch Ratings has downgraded LPKR’ debt rating to become a level of junk or not worthy of investment. in detail becoming S&P rated CCC + than before B- and followed by Fitch at CCC+ level.

LPKR established in 1990 focused on urban development, large scale integrated development, retail malls, healthcare, hospitality and infrastructure, property and portfolio management. Lippo Group related companies owned 58.89 percent ownerships in the company and public 41.11 percent.

Lippo Karawaci owned 51.05 percent shares of PT Siloam International Hospital Tbk (IDX: SILO), 54.3 percent shares of PT Lippo Cikarang Tbk (IDX: LPCK), 62.69 percent PT Gowa Makassar Tourism Development Tbk (IDX: GOWA) and 100 percent Bowsprit Asset Management.

US$1: Rp14,000

by Linda Silaen, Email: linda.silaen@theinsiderstories.com

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