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Thursday, January 28, 2010

Two Prajogo Pangestu's company issuing bonds: Chandra Asri issue US$230 million, Star Energy to 5 year bonds

BI / bursa
18/1/10
By Irvin Avriano A.
for Bisnis Indonesia

Two Prajogo Pangestu's company issuing bonds: Chandra Asri issue US$230 million, Star Energy to 5 year bonds

JAKARTA: PT Chandra Asri Petrochemical Center will issue bonds of US$230 million of US dollar-denominated next week. The company also added Standard Chartered Plc as underwriter from previously only DBS Group Holdings Ltd and Deutsche Bank AG.

The company will issue the debt through its subsidiary, Altus Capital Pte, which guaranteed by Chandra Asri and PT Styrindo Mono Indonesia.

Based on the Bloomberg sources report yesterday, the company has set a target which is smaller than the initial plan of US$250 million.

Chandra Asri is a leading producer of ethylene and propylene as much as 70%-owned PT Barito Pacific Tbk either directly or indirectly. The owner of Barito Pacific and PT Medco Energi Internasional Tbk, businessman Prajogo Pangestu, also served as the main commissioner Chandra Asri.

Barito Pacific has a stake in Chandra Asri for 62.76% directly and through its subsidiary company's, Marigold Resources Pte Ltd for 7.24%.

Investor Relations Manager Barito Pacific Agustino Sudjono when trying confirmed yet able to provide comment. "We are still studying all aspects of the bond sale plan, including the time for [publishing]," said Agustino as quoted by Bloomberg yesterday.

Besides Chandra Asri, another Prajogo Pangestu company, PT Star Energy, also plans to issue US dollar bonds tenured 5 years. The Company will held meeting with potentials investors in Hong Kong, Singapore, London and the US since last January 27th.

Bloomberg reported Energy Star use service from Barclays Capital, Nomura Holdings Inc and Standard Chartered Plc as the underwriter in the issuance of the bonds. Star Energy's Operational Director Rudi Suparman justify the company will issue US dollar bonds in the 1st quarter 2010.

Corporate bond market is expected to improve with the increase in bond ratings Indonesia earlier this week. Improved ratings were predicted to raise up the issuance of government bonds and corporate Indonesia after reducing debt issuance costs either rupiah or dollar-denominated.

Issuer default ratings og debt long-term Indonesian rupiah-denominated and foreign credit upgraded by Fitch Ratings from the level of BB to BB+ with stable outlook earlier this week.

At the same time, Fitch also raises country ceiling level of Indonesia from BB+ to BBB level and affirm the short-term ratings of foreign-denominated debt at a level B.

Barito buy Chandra Asri shares in 2007 worth US$1.05 billion, equivalent to Rp9, 76 trillion. Barito finance the acquisition with funds from rights issue worth Rp9.16 trillion and the transfer of receivables from Barito Rp697, 5 billion to PT Inti Citra Inter Petrindo.

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