Tower operator STP debuts USD300m five-year bond

13 Feb 2015

According to Finance Asia, Indonesian tower operator Solusi Tunas Pratama (STP) has sold a USD300 million, five-year bond on the international markets, becoming the second such firm to tap into debt financing in a little over a week. According to the term sheet seen by the online journal, STP – the third largest tower leasing company in Indonesia – priced the bond at an ‘all-in’ yield of 6.25% (below its initial guidance of 6.50%), generating orderbooks of over USD1 billion from 125 accounts (73% of which were in Asia and the rest in Europe). The proceeds of the offering will be used to partially refinance STP’s six-month USD790 million bridge loan facility that was used to refinance the acquisition of 3,500 towers from XL Axiata for IDR5.6 trillion (USD467 million), according to a source familiar with the matter.

Going forward, STP is looking to maintain its position in the Indonesian tower market through acquisitions and a moderate build-out of new towers — i.e. between 300 and 400 towers a year — compared with peers such as Profesional Telekomunikasi Indonesia (Protelindo) and Tower Bersama Infrastructure, which have been adding more than 1,000 towers per annum. As at 31 December 2014, STP owned 6,651 towers and total tenancies of 10,521. Tower Bersama leads the industry with 15,200 towers followed by Protelindo with 11,200.

Indonesia