Indonesia’s Tower Bersama Infrastructure (TBI) has set up a Rp4trn (US$348.2m) bond programme.
HSBC, Indo Premier, NISP and UOB Kay Hian are working on the transaction. Proceeds will be used to fund its capex and repay some of its units’…
Indonesia’s Tower Bersama Infrastructure (TBI) has set up a Rp4trn (US$348.2m) bond programme.
HSBC, Indo Premier, NISP and UOB Kay Hian are working on the transaction. Proceeds will be used to fund its capex and repay some of its units’ loans.
Fitch gave the proposed offering a national rating of AA-(idn), noting that the bond is structurally subordinated to the operating companies’ secured debt of Rp7.8trn (US$681m).
“Despite subordination, Fitch believes that recovery, in case of default on the notes, would be average or better, and has assigned an instrument rating at the same level as the TBI’s national long-term rating,” the agency said.
A high proportion – about US$2.2bn – of the company’s operating cash flows is contractually locked-in, which means there will be strong creditor recovery in a distress scenario.
Fitch also believes that TBI’s plan to replace its operating companies’ unsecured debt with unsecured debt at the holding company level will reduce the level of subordination, further supporting recovery on the proposed notes.
From the Rp4trn, about Rp1trn (US$87.2m) will reportedly be issued next month.
Tower Bersama owns and operates 9,308 telecommunication sites serving 15,293 tenants as of June 2013. The company is majority owned by Saratoga Capital and Provident Capital.
The towerco generated revenue and EBITDA of Rp1.27trn (US$111m) and Rp1trn respectively for the first half of 2013. Total debt as of 30 June 2013 was Rp10.84trn (US$947.6m) and gross senior debt was Rp7.85trn.
