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Thursday, August 11, 2011

5 Trillion on PT Citra Marga Nusaphala Persada Tbk Expansion

PT Citra Marga Nusaphala Persada Tbk (CMNP) require huge funds for the rolling agenda of expansion. Toll road operator is planning to acquire three toll roads, establishing a toll project initiation, plus acquiring a mining company's infrastructure provider. Total funds needed around Rp 5 trillion.

To do this expansion, CMNP will establish a new subsidiary with 95% ownership. Indrawan Sumantri, Finance Director CMNP said, toll roads that became the target was in Jakarta. "We prefer urban areas," he said on Wednesday (10 / 8).

However Indrawan still mum about the toll roads that will be acquired. However, he said, the construction of this toll road project underway. Within this company, the acquisition and establishment of toll projects require funding of up to Rp 3.5 trillion.

To acquire the mine infrastructure provider, CMNP estimated to cost up to Rp 1.5 trillion. "That has included acquisitions and investments for the company," said Indrawan. Again, still under CMNP management company name.

In the acquisition, CMNP intention of becoming a majority shareholder, with a portion of ownership of 51% -60% range. CMNP target acquisition will be completed later this year.

CMNP funding requirements are not exactly little. CMNP plans to seek funding from third parties to cover its needs. At the end of the first quarter of 2011, cash and cash equivalents amounting to Rp 464.78 billion CMNP.

CMNP internal cash already allocated around Rp 500 billion to Rp 700 billion to execute expansion plans this year.

Strengthen capital

Before seeking external funding, the company will increase its capital through issuance of new shares without Preemptive Rights (ER). Of the rights issue, CMNP hope pocketed funds amounting to Rp 240 billion.

After the issuance of shares without scrolling Rights, will establish a new CMNP child who gets to take care of business acquisitions. Just for the record, CMNP already pocketed shareholder approval, yesterday, for the rights issue.

CMNP also will issue bonds worth Rp 3 trillion to Rp 4 trillion. This will be done gradually in several series. CMNP still have to hold AGM for the bond plan.

Indrawan said, there were three foreign institutions who are interested to be underwriters. The bonds will be issued in global markets. "But in rupiah bonds, because we do not want to bear the risk. Our sources of funding dollars, "said Indrawan.

One of the three underwritter offers tenor for 12 years. "We still see him as what the cost," said Indrawan. Typically, CMNP bond issue of five-year tenure.

Indrawan said, bold capital firm step prior to issuing bonds intended to keep the ratio of debt to equity or debt to equitiy ratio (DER) maximum of 1 time.

This year, CMNP will release the new shares as well as the first series of bonds. The value of the bonds range from Rp 1 trillion to Rp 1.5 trillion. The next year, CMNP back issue bonds to cover the remaining funding requirements. "We will use the financial statements of June for both," said Indrawan.

Shadik Wahono, Director of CMNP added that this acquisition will boost the company's revenue is up to 3.5 times the achievement in 2011. The increase was target to be implemented in 2014.

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