RETAIL in the next five years. Chairman
Mukesh Ambani told shareholders at the
company’s annual general meeting, “We
have received strong interest from strategic
and financial investors in our consumer
businesses. We will induct leading global
partners in these businesses in next few
quarters, and move towards listing both
these companies in next five years.”
Reliance Industries is also set to sell a
20% stake in its oil to chemicals business to
Saudi Aramco for around US$15bn, Reuters
reported, quoting executive director PMS
Prasad.
Founded in 2016, Jio is one of India’s
leading wireless broadband service provider
with 331.3 million subscribers as of June
30 2019. The parent has already started
cutting Jio’s debt by transferring its telecom
infrastructure assets into two separate
infrastructure trusts with the intention
of raising money from large global
institutional investors.
“We have received strong interest
and commitments from reputed global
investors and are confident that these
transactions will be completed by the end
of this financial year [on March 31 2020],”
Ambani said.
Jio reported revenue of Rs117bn in
the first quarter to June 30, up 44% from
Rs81bn in the year-ago quarter. Net profit
rose to Rs8.9bn from Rs6.1bn during the
same period.
Founded in 2006, Reliance Retail operates
India’s largest chain of neighbourhood
stores, Reliance Fresh, as well as
supermarkets, wholesale cash and carry,
and specialty stores. It had over 10,000
points of sale as of March 2018, according
to its website.
Its revenue rose to Rs381bn in the first
quarter from Rs258bn in the same period
a year ago. Operating profit rose to Rs20bn
from Rs12bn during the same period.
INDONESIA
DEBT CAPITAL MARKETS
› CIKARANG SEEKS CHANGES
Indonesian power producer CIKARANG
LISTRINDO is seeking consent from holders of
its US$547m 4.95% bonds due 2026 to make
amendments to the terms.
Wholly owned subsidiary Listrindo
Capital issued the bonds in 2016 with a
guarantee from its parent company, but
Cikarang Listrindo is seeking to replace it
as issuer.
It is offering to pay consenting
bondholders US$1.50 per US$1,000 in
principal amount, and needs holders of a
majority of the bonds to agree.
Barclays and Deutsche Bank are consent
solicitation agents, and Lucid is information
and tabulation agent. The offer ends on
August 30.› ALAM SUTERA EYES US$175M FROM BONDSIndonesian property developer ALAM SUTERA
REALTY aims to raise US$175m from global
bonds by April 2020 to refinance debt,
according to local news reports.
The company is assessing market
conditions for a potential bond issue. The
proceeds will be used to call US$175m
2021 notes, which have a call option from
April 2020 onwards. Alam Sutera is also
exploring options to issue rupiah bonds.
The company said that Indonesian
property buyers are in a “wait and see” mode
despite tax incentives for property buyers.
On June 19, the government lowered the
threshold for the 20% sales tax on luxury
properties to landed property or apartments
worth at least Rp30bn (US$2.1m), from
Rp20bn for landed property and Rp10bn for
apartments previously.
Alam Sutera has revised its sales target to
Rp4trn from Rp5trn for this year.
The fundraising announcement is
positive, according to Lucror Analytics.
“By voicing out a refinancing plan,
the company will be able to manage
investors and particularly rating agencies’
expectation.”
In May, the property developer added
US$125m to its US$245m 6.625% bonds due
April 24 2022 in a reopening that priced
at 95.176 to yield 8.5%. At the time, S&P
affirmed its B rating with negative credit
watch. The rating agency said the tap
would alleviate near-term liquidity pressure
caused by the upcoming redemption of a
US$73m bond in March 2020.› INDONESIA CUTS TAX ON BONDSIndonesia has reduced the taxation of bond
interest payments for mutual funds to
5% until 2020 from 15% earlier, as part of
measures designed to encourage funds to
invest in fixed income securities.
The tax rate will increase to 10% from
2021 onwards, the cabinet office said in a
statement last Thursday.
In June, the finance ministry had
said that it would lower the tax rate on
income from investments in infrastructure
securities to 5% from 15% to accelerate
economic growth.
The latest announcement comes as
Indonesia’s central bank cut base rates by25bp to 5.5% on Thursday, its second cut in
two months.› MPM FINANCE EYES DEBUT BONDSMITRA PINASTHIKA MUSTIKA FINANCE is eyeing
Rp800bn from a debut issue of three-part
rupiah bonds, according to a source close to
the plans.
The Indonesian financing company has
given indicative yield ranges of 8.25%–9.25%
for a three-year tranche, 8.50%–9.50% for
a four-year portion, and 8.75%–9.75% for a
five-year part.
CGS-CIMB Sekuritas and Indo Premier Sekuritas
are the arrangers for the bond issue.
MPM is yet to make an official
announcement on the planned bond sale.› INDONESIA EXIMBANK EYES 4-PART BONDSINDONESIA EXIMBANK has fixed the yields for a
Rp1.17trn four-part bond and sukuk issue,
according to a filing on the Indonesia
Central Securities Depository.
It has fixed the yields at 7.00%, 7.80%, 8.10%
and 8.50% for 370-day, three-year, five-year
and seven-year tranches to raise Rp283bn,
Rs15bn, Rp6bn and Rs715bn respectively.
It has raised Rp150bn from a 370-day
sukuk portion at a floating rate.
The issuer was targeting Rp2trn from the
bond and sukuk offering.
Bahana, BCA, BNI, CGS-CIMB, Danareksa, DBS
Vickers, Indo Premier and Mandiri Sekuritas are
the lead managers for the deal.
The bonds will be distributed to investors
on September 3.SYNDICATED LOANS
› ASIAN BANKS DOMINATE JTB LOANA host of Asian lenders have backed the
recently signed US$1.85bn syndicated loan
for the Jambaran-Tiung Biru natural gas
project of Indonesian state energy firm
PERTAMINA.
Intesa Sanpaolo was the only non-Asian
bank in the borrowing, which was
among the largest project financings for
Pertamina.
Bank Tabungan Pensiunan Nasional, Bank of
China Hong Kong branch, Bank of China Jakarta
branch, Bank Mandiri, Bank Negara Indonesia,
Bank Rakyat Indonesia, CIMB Bank, DBS Bank,
Maybank, MUFG and Sumitomo Mitsui Banking
Corp were the other lenders participating.
MUFG was the sole financial adviser,
facility agent, investment agent and
hedging solutions provider.
The deal was unique because it
included Islamic PF facilities under trustee
borrowing schemes, according to a press