Lippo Karawaci Completes $270.6 M Bonds Sale, Rating Confirmed

Indonesia Finance

Wednesday, 12 May 2010 12:23

Written by Badai

Property developer PT Lippo Karawaci Tbk, owned by Lippo Group, has completed the sale of its bonds worth US$270.6 million, due April 30, 2015. The amount is lower than originally planned of US$350 million.

Fitch Rating said it has assigned a final rating of ‘B+’ and final recovery rating of ‘RR4’ to the senior notes. The bonds were issued by Sigma Capital Pte Ltd, a wholly owned subsidiary of PT Lippo Karwaci Tbk and guaranteed by Lippo Karawaci.

The final rating is the same as the expected rating assigned on April 9, 2010. Although the issue size is lower than the US$350 million previously communicated by the company, Fitch views that LK's capital structure and credit profile have not changed materially,” it said.

The final rating was given after the property developer completed the bonds issue and after the rating agency received documents, conforming to information previously provided, Fitch said.

The 2015 Notes were offered as part of an exchange offer for the US$250 million notes due 2011, issued by Lippo Karawaci Finance B.V. and guaranteed by Lippo Karawaci.

The final aggregate of the 2011 Notes accepted for the exchange offer reached US$183.75 million, while the remaining note holders will hold the 2011 Notes until its maturity.

“Fitch believes that LK's good liquidity position with cash and cash equivalents of Rp1.53 trillion (around US$163 million) at end 2009 and good access to domestic banks should allow it to refinance the remaining portion of the 2011 Notes when it matures in March 2011,” the rating agency said.

The company has said that the remainder of the Notes will be used for capital expenditure and general corporate purposes.

On Tuesday, Lippo Karawaci’s shares closed down Rp10 at Rp540. Since end last year, its shares had increased by only 6%.

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