JAKARTA (TheInsiderStories) – State-owned cement producer, PT Semen Indonesia Tbk (IDX: SMGR) released local bonds with total amount Rp4.08 trillion (US$ 326.39 million). The funds will be use to pay the long-term debt of its new unit PT Holcim Indonesia Tbk (IDX: SMCB) from Holdervin B.V.
Based on the disclosure of information to the Indonesia Stock Exchange (IDX), the company said, the bond have two series. Series A worth of Rp3.36 trillion with coupon rate of 9 percent and tenor five years. Series B has value of Rp714 billion with a coupon rate 9.10 percent with a period of seven years.
Semen Indonesia will still carry out the allotment process on May 24 and electronic distribution on May 28 and register the securities on the exchange on May 29. The issuance of the second phase is part of the ongoing public offering totaling Rp8 trillion. Previously the company had issued Rp3 trillion.
According to the prospectus, Holcim has total debt Rp13.07 trillion from the consortium of foreign banks namely BNP Paribas, Deutsche Bank AG, Singapore branch, Maybank Kim Eng Securities Pte Ltd, MUFG Bank Ltd, and Standard Chartered Bank. The plan is that the bonds will be paid in advance for Rp3.48 trillion.
Semen Indonesia purchased 6.18 billion shares or equivalent to 80.6 percent of the ownership in SMCB with worth $917 million. In addition, the company spent Rp2.83 trillion for the tender offer of 1.35 billion shares with price of Rp2,097 each.
Moreover, seeing the company’ achievement in the first quarter (1Q) 2019 is unsatisfactory, the bond offering is an alternative to get funding. Reportedly, the sales volume of Semen Indonesia in 1Q 2019 decreased to 1.97 million tons, or down 4.36 percent compared to March 2018 of 2.06 million tons.
While the export sales volume in March 2019 also decreased by 15 percent, where the company only achieved total exports of 245,344 tons, smaller than the March 2018 period of 288,845 tons.
In January – May, Semen Indonesia recorded cement sales volume of 5.97 million tons, down slightly by 0.03 percent compared to the previous year of 6.19 million tons.
Written by Lexy Nantu, Email: email@example.com