Paper Producer Owned By Eka Tjipta Widjadja Seeks IDR 3.25 Trillion To Pay Debt

Illustration. (Photo: Doc. Antara)

JAKARTA - A paper producer from the Sinar Mas group, PT Indah Kiat Pulp & Paper Tbk, will carry out a corporate action this year. The company coded INKP shares plans to issue bonds with a principal amount of up to IDR 3.25 trillion.

Quoted from the information disclosure page of the Indonesia Stock Exchange (IDX), Thursday, March 4, the company owned by the late Eka Tjipta Widjaja will issue a sustainable bond I Indah Kiat Pulp & Paper Phase IV Year 2021 with a principal amount of around IDR 3.25 trillion in 3 series.

The first series has a principal amount of IDR 1.08 trillion with a tenor of 370 calendar days from the date of issuance and a coupon of 7.25 percent, the second series is IDR 1.89 trillion with a 3-year tenor of 9.5 percent, and the third series is IDR 277.7 billion with a 5-year tenor with a coupon of 10.25 percent.

The bonds are included in I Indah Kiat Pulp & Paper's sustainable public offering (PUB) program with a target fundraised of IDR 10 trillion.

Indah Kiat Pulp & Paper's management explained that the proceeds from the bond issuance after deducting the related issuance costs will be used around 60 percent for the payment of the company's debt installments in the form of loan principal and/or interest.

"The rest will be used for the company's working capital, including the purchase of raw materials, production supporting materials, energy and fuel, packaging goods, and overhead costs", wrote Indah Kiat Pulp & Paper Management.

These bonds are not guaranteed by special collateral in the form of objects or income or other assets owned by the company in any form and are not guaranteed by any party. These bonds are rated A + or single-A plus from PT Pemeringkat Efek Indonesia (Pefindo).

As executing guarantor and bond issuance are PT BCA Sekuritas, PT BNI Sekuritas, PT Binaartha Sekuritas PT BRI Danareksa Sekuritas, PT Maybank Kim Eng Sekuritas, PT Sinarmas Sekuritas, PT Sucor Sekuritas, and PT Trimegah Sekuritas Indonesia Tbk.

PT Bank KB Bukopin Tbk will act as trustee. The bonds are planned to be listed on the Indonesia Stock Exchange on March 24, 2021, with a public offering period on March 16 and 17, 2021.