Thursday, November 25, 2010

Mandiri provided US$100 milion loan to Buma

PT Bank Mandiri Tbk provided around $100million as part of a $600 million syndicated loan to PT Bukit Makmur Mandiri Utama, Indonesia' second largest coal mining contractor, to refinance debt and buy back bonds.
Morgan Stanley has been mandated by PT Bukit Makmur Mandiri Utama (Buma), wholly owned subsidiary of PT Delta Dunia Makmur Tbk, as lead arranger of bonds and loan buyback.
Morgan Stanley will utilize new financing coming from syndicated bank loans worth US$600 million to refinance Buma's existing debts.
As of September 2010, Buma recorded US$568.36 million major debts consisting of bank loans of US$253.36 million and US$315 million bonds issued on November 2009.
The existing bank loans charge annual interest rate of 4.5% above Libor 3 months and 5% margin. The loans will mature in 2013.Prime Dig Pte Ltd, guaranteed by Buma, has US$315 million bonds due on November 3 2014, charging annual interest rate of 11.75% and 20% witholding tax. Those interest represents a 14.1% effective interest rate.
Buma is in talks with several banks such as Sumitomo Mitsui Banking Corporation, ING Bank, Bank of Tokyo, Bank Mandiri, dan Bank Exim to secure US$600 million loans.With the interest of 5% above Sibor or 6%-7% in total, Buma could save US$25 million cost of financing a year.
The buyback has conveyed the bonds price higher. Prime Dig bonds price yesterday was traded at 104.21%, dropped from the higest level of 105.50%. On August 10, the bonds price stood at 101.33%.

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