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Wednesday, October 20, 2010

Lippo Karawaci appoint Deutsche and Citi for its US$100 mio bond

Irvin Avriano A.
Bisnis Indonesia

Lippo Karawaci appoint Deutsche and Citi for its US$100 mio bond

JAKARTA: PT Lippo Karawaci Tbk appointed two international investment banker, Citigroup Capital Markets and Deutsche Bank AG to issue US dollar-denominated bonds worth US$100 million.

Based on the corporate information disclosure to the Indonesia Stock Exchange (IDX/Bursa Efek Indonesia) this evening, its mentioned that the issuance of debt securities will be made next month.

"This issuance is to utilizing time of the low global interest rates and expected could result in' company's cumulative savings to 2-5% in 5 years ahead," said Lippo Karawaci Director Tjokro Libianto in the information disclosure this evening.

He said the issuance also intended to repay and refinance the company bonds that will mature in March next year. In addition, the company also plans to use bond funds to finance the growth of its business model transformation.

The company currently pocketing B1 rating from Moody's Investors Service, of B+ ratings by Fitch Ratings, and B ratings from Standard & Poor's.

Tjokro said the ratings had been pinned for 5 years, which indicates the company is able to maintain its financial condition, corporate governance and good discipline.

The performance of the company, he said, including debt to equity ratio (DER), as low as 0.46 times and low total debt that is 5 times from their earnings before interest, taxes, depreciation, and amortization (EBITDA).

DER calculation was performed before company's rights issue worth IDR2.25 trillion executed. He also said that DER will continue to decline until the level of 0.32 times at the end of this year.

The company, he said, had also already pocketed from the rights issue that haven't been done yet, and was planned do the end of December this year. Rights issue will increase the number of shares and increase the company's capital by 42.7% to IDR7.5 trillion.

He said the funds had been deposited to the account of issuers from several investment banks that fund that been coordinated by PT Ciptadana Securities.

In a separate announcement, the company announced an advanced subscription agreement with the five-party standby buyer for the rights issue plan

The five namely PT Metropolis Propertindo Utama, Alpha Consulting Ltd, Boston Investment Ltd, Meridian Investment Ltd, and New Host Ltd which have provided funds amounting to IDR2.2 trillion. The funds will be used by the company as a deposit for a reservation at a later date or advance the company shares to be issued in the rights issue.

The company also says it will hold a extraordinary general meeting of shareholders (EGM) to obtain the approval from its shareholders. However, the company said the announcement had previously been conveyed only through the company website.



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