Bakrie Telecom, the Indonesian mobile operator, is considering selling new shares in itself in an attempt to pay back some of its debt, according to a Reuters report.
A deal, which would take the form of a non pre-emptive rights issue, could allow…
Bakrie Telecom, the Indonesian mobile operator, is considering selling new shares in itself in an attempt to pay back some of its debt, according to a Reuters report.
A deal, which would take the form of a non pre-emptive rights issue, could allow Bakrie Telecom to raise about Rp900bn (US$99m). Credit Suisse is acting as the financial adviser of Bakrie & Brothers, the owner of Bakrie Telecom, Reuters reported.
Two companies – South Korean SK Telecom and local conglomerate Sampoerna – have reportedly already been approached for a 10% stake in Bakrie Telecom.
Sources close to the matter were quoted saying that Sampoerna may be the frontrunner. It suggested that following this deal, the conglomerate could try to raise its stake in Bakrie Telecom and merge the operator with its own mobile unit, Ceria Mobile.
In mid-January, Bakrie & Brothers had already divested a 10% stake in the operator, reportedly to financial investor Mount Charlotte, for US$159m.
According to a recent Fitch Ratings note Bakrie Telecom is also looking to sign a refinancing loan to repay a Rp650bn (US$71.4m) bond, which matures in September 2012 (see here).
The ratings agency expects the company to breach the financial covenants of its obligations because of its high leverage and poor trading results.