COUNTRY REPORT INDONESIA› SHRIRAM PROPERTIES TO FILE IPO
SHRIRAM PROPERTIES plans to file the draft
prospectus for a Rs10bn–Rs15bn IPO next
month, people with knowledge of the
transaction have said.
Axis, Edelweiss and Nomura are the
bookrunners.
The IPO is likely to be a combination of
primary and secondary shares.
The company develops residential and
commercial projects mostly in South India
and has a portfolio of 20 million square feet
of built-up space. It is part of the Shriram
Group, which has interests in financial
services.
Other real estate firms that have
also filed for domestic IPOs are Lodha
Developers and Puranik Builders (Rs10bn).
However, both companies have pushed
back the deals because of weak market
conditions.
› JSW STEEL RIGHTS OFFER CLEARED
The board of directors of JSW STEEL has
approved the company’s plan to sell rights
shares of up to Rs50bn.
The timing of the issue and the
underwriting bankers will be decided
later.
Jindal Organisation owns 19.56% of
the company, followed by JFE Steel
at 15.08% and JSW Techno Projects at
10.29%.
JSW Steel shares are up 28% year to date.
INDONESIA
DEBT CAPITAL MARKETS
› PERTAMINA POSTPONES NEW ISSUEPERTAMINA (Baa2/BBB–/BBB) has postponed
a proposed new US dollar bond issue and
called off a tender offer for some of its
existing paper.
The Indonesian state-owned oil and gas
company visited Asia, London and the
US last week ahead of a potential 144A/
Reg S bond issue via joint bookrunners
BNP Paribas, Deutsche Bank, HSBC, Standard
Chartered and Mandiri. Investor meetings
ended on October 24.
Pertamina announced that the bond
offering would not go ahead at the
moment, but a lead said the issuer might
look at another window later.
The new issue would have funded a
tender offer for Pertamina’s US$1bn 5.25%
senior notes due 2021 and its US$1.242bn
4.875% senior notes due 2022.
It had offered US$1,034.50 per US$1,000
in principal amount of the 2021s, and
US$1,022.50 per US$1,000 of the 2022s.
The offer ended on October 25, and was
dependent on completing a new issue large
enough to fund the tender offer and leave
at least US$500m for general corporate
purposes.That meant that the tender offer was
dependent on Pertamina being able to price
a new bond on Thursday, which turned out
to be an extremely weak session for Asian
credit, following drops of 2.4% and 3.1%
in the Dow Jones and S&P stock indices in
Wednesday’s US trading session.
The same banks were dealer managers
for the tender offer.› PAN BROTHERS BUYS BACK BONDSPAN BROTHERS will repurchase US$28.922m
of its US$200m 7.625% bonds due 2022,
following a tender offer.
The purchase price was set at 95% of face
value.
The Indonesian apparel supplier had
offered to pay 92%–95% of face value, and
buy up to US$40m of bonds, with the price
decided by a modified Dutch auction.
Netherlands-incorporated subsidiary PB
International issued the bonds in January
2017 with a guarantee from Pan Brothers and
its subsidiaries. It was a debut offshore issue.
ANZ was dealer manager for the offer.› INALUM HIRES FOR DOLLAR BONDSIndonesian state-owned aluminium
producer INDONESIA ASAHAN ALUMINIUM (Inalum)
has hired banks to arrange investor
meetings ahead of a potential US dollar
bond offering, after it agreed to buy a
majority stake in the world’s second-biggest
copper mine.MSky seeks extension of 2016 facility
Loans Pay-TV operator to stretch maturity by another three yearsIndonesian pay-TV operator MNC SKY VISION is
reaching out to lenders to extend a US$170m
three-year loan signed in 2016.
Deutsche Bank and Standard Chartered
were the mandated lead arrangers and
bookrunners of the deal, which will be
extended by another three years. The terms
and conditions of the financing, which pays
an interest margin of 425bp over Libor, will
remain the same.
The US$170m single-tranche loan – used
to refinance a US$243m three-year deal from
December 2013 – was reduced from a size of
up to US$225m when launched into general
syndication.
The financing was originally split into
a senior amortising term loan (tranche A)
and a bullet loan (tranche B). The top-
level all-in pricing in general syndication
was 494bp and 617bp based on interest
margins of 425bp and 500bp over Liborfor tranches A and B, respectively. The
average life was 2.9 years. ING Bank and
Siemens Financial Services joined in senior
syndication, while three other lenders
participated in general syndication.
At that time, the borrower endured
a challenging period following two
downgrades to the ratings of MSky’s parent
MNC Investama from B to B− by S&P and B3
to Caa1 by Moody’s in August and September
2016, respectively.
MSky subsequently repaid 25% of the
US$243m loan in mid-September with
help from Rp1.1trn it largely raised through
additional capital contributions from
Jakarta-listed Global Mediacom, the holding
company of MSky and its affiliate Media
Nusantara Citra. The Rp1.1trn was raised over
a nine-month period ending September 30
2016.
Following the first principal repayment ofthe 2013 loan, MSky decided to cap the size
of the new refinancing loan to US$200m
with a single-tranche structure instead of
the dual-tranche borrowing it had sought
initially.
The December 2013 loan paid a top-level
all-in pricing of 490bp via a margin of 425bp
over Libor, based on an average life of 2.9375
years.
Separately, MSky’s affiliate free-to-air
broadcast company Media Nusantara Citra
most recently raised another US$50m
through an accordion facility last December
after closing a US$200m four-year
refinancing in August 2017.
Deutsche Bank, ING and StanChart were
the MLABs of the 2017 transaction, which
originally offered a top-level all-in pricing of
366.5bp based on a margin of 325bp over
Libor and an average life of 3.85 years.
CHIEN MI WONG