Sep 23, 2009

Finally BUMI-CIC deal comes out

PT Bumi Resources Tbk (BUMI) announced that China Investment Corporation (CIC) has invested US$1.9 billion in Bumi in the form of a debt-like instrument.
The US$1.9 billion investment consists of US$600 million repayable in year 4, US$600 million in year 5, and remaining US$700 million in year 6. The investment attracts a 12% annual cash coupon with a total IRR of 19%, the balance payable at the time of final maturities. The funds will be used for debt restructuring and capital expenditure.
“We are honored by this historic and transformational investment by CIC, the leading sovereign fund in the world. The investment will enable Bumi to implement its growth strategies quickly and provide a stable capital structure. More importantly, the partnership creates the platform for CIC and Bumi to pursue investment opportunities jointly”, remarked Ari Hudaya, President Director and CEO of Bumi, one of the leading natural resources companies in Asia with world-class coal assets, in a press release today.
CIC, wholly-owned by the People’s Republic of China, is one of the largest and reputable investment institutions in the world. Bumi is Indonesia's largest producer and one of the world’s largest exporter of thermal coal with strong practices in community development, corporate social responsibility and corporate governance.
PT Samuel Sekuritas Indonesia acted as arranger and financial advisor, and Jones Day acted as legal advisor to Bumi. Deutsche Bank and China International Capital Corporation (CICC) acted as financial advisors and Davis Polk & Wardwell acted as legal advisor to CIC in this transaction.

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