Telkom reveals USD326m bond issue for June

4 Jun 2010

Indonesian telecoms giant PT Telekomunikasi Indonesia (Telkom) plans to issue up to IDR3 trillion (USD326 million) worth of bonds on 28-29 June, with part of the proceeds set to be used to shore up its CAPEX. Dow Jones reports that in its prospectus, published today, Telkom has selected Bahana Securities, Danareksa Sekuritas, and Mandiri Sekuritas to act as the lead underwriters of the bond sale, which will be issued in two tranches – one with a five-year maturity and the other over ten years. It is understood that the telco is yet to decide on the exact size and coupon value for each tranche, and that local ratings agency PT Pemeringkat Efek Indonesia has assigned ‘AAA’ ratings to the bonds, which will not be guaranteed by the government, which currently holds a 51.2% stake in Telkom.

In a separate story, Reuters reports that Telkom is in talks with fellow mobile phone operator Bakrie Telecom on the possible consolidation of their CDMA operations in the country. The news comes in the wake of Bakrie Telecom posting a sharp rise in profits in the first quarter of this year. Bakrie said this week its net profit leapt to IDR29.05 billion in the first three months of 2010 from IDR5.73 billion a year earlier due to foreign exchange gains and lower operating costs. Operating costs for the period fell to IDR585.22 billion from IDR605.12 billion a year earlier, it said, while it booked IDR28.21 billion in foreign exchange gains, up from IDR14.19 billion in the previous year. Bakrie Telecom, which had 10.6 million customers at the end of 2009, expects to boost its base by around 32% to 14 million by end-2010.

Indonesia, Bakrie Telecom (BTel), Telkom Indonesia