Berau Capital Resources Ptd Ltd, wholly owned subsidiary of PT Berau Coal Energy, has set an indicative coupon of its 5 year bond at 12.5% annually.
A source familiar with the matter also said Berau Capital might downsize its bond from initial size of US$600 million to around US$350 million-US$400 million because the company has obtained the offer of syndicated loan from some banks.
Berau Coal Energy, previously dubbed PT Risco, is parent company of Indonesia's fifth largest coal mining producer PT Berau Coal. "Berau Capital plans to price its bond tonight," the source said.
Berau Coal Energy is wholly owned by PT Bukit Mutiara, which is also controlled by Recapital Advisors. Berau Capital has mandated Credit Suisse Group and Deutsche Bank to arrange the bond issuance.
Global rating agency Standard & Poor's Ratings Services has assigned B+ issue rating to the proposed senior secured notes to be issued by Berau Capital Resources. It plans to issue around US$600 million of bond to refinance its debt.
In mid June, IFR reported around 10 lenders, including one institutional investors, have committed US$325 million-US$350 million in total to the US$400 million four year loan for Berau Coal.
Another two or three banks are processing approvals for the deal, which if oversubscribed could lead to an upsizing.
Credit Suisse is expected to keep the syndication open on loan until the launch of an up to US$500 million global bond, which complements the loan. Should the loan be upsized, the size of the bond could be reduced.
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