JAKARTA. The coal issuers are apparently becoming more prestigious lately. One of the coal issuers PT Delta Dunia Makmur Tbk (DOID) has succeeded to sell its bonds at the global markets.
DOID has issued global bonds worth US$ 350 million. Financial Director of DOID Eddy Purwanto said, DOID has conducted book-buildings in Asia, Europe, and the US (the United States of America) with the coupon of 7.75%. From the book-buildings, DOID generated as much as US$ 2.25 demands, or oversubscribed by 6.5 times.
DOID only issued an amount of bonds of less than the maximum target of US$ 500 million, despite of the high demands. At the same time, DOID received bank loans worth US$ 100 million from Bank of Tokyo Mitsubishi UFJ (BTMU) with an interest rate of LIBOR+3%.
According to Edy, DOID could receive a competitive interest rate, thanks to the positive responses of the investors.
DOID issued the new bonds through its subsidiary PT Bukit Makmur Mandiri Utama (BUMA). About 50% and 16% of demands for DOID’s bonds came from Asia and Europe, respectively, while the rests are from the US. The issued bonds will be listed on Singapore Exchange Securities Trading Limited.
The bonds were issued to cover the debts, which will be matured in December 2019. The debts comprise of the remaining loans from Sumitomo Mitsui Banking Corporation (SMBC) and Bank CIMB Niaga Tbk (CIMB) worth s US$ 507.39 million and US$ 13.16 million, respectively.
Cash flow
DOID’s subsidiary BUMA received Ba3 with the stable outlook and BB- with the stable outlook from Moody’s and Fitch, respectively. Analyst at Moody's Rachel Chua said that the Ba3 rating indicates that BUMA has proper contracts with some companies, which hold major coal concessions in Indonesia.
“The long term contract is the basic revenue source for a company. This reflects the cash flow sufficiency,” Chua said. Moody’s also considered the solid BUMA’s financial profile to grant the rating.
Since 2012, this coal mining issuer has refinanced the debts worth US$ 346 million. The number of remaining debts has dropped from US$ 942 million in 2012 to US$ 596 million on 30 September 2016.
Moody’s expects that the value of debt to EBITDA of BUMA will be tripled in 2017-2018. Meanwhile, the retained cash flow (RCF) over net debts during the same period will be above 25%.
On Tuesday (8/2), the price of DOID’s share dropped by 4.17% from Rp 575 per a share on the previous day. Previously, the price of a DOID’s share once hit Rp 620 (3/2), hiked by 21.57% since the early of year. At the end of third quarter of 2016, the price of a DOID’s share remains standing at Rp 226.
(Muhammad Farid/Translator)
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