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Flush With Funds From IPO, Miner ABM Investama Pays Down Debts
Dion Bisara | January 17, 2012

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Serigala-Berbulu-Domba
3:03am Jan 18, 2012

...Reswara controls three coal mining concessions in Aceh and South Kalimantan that have more than 500 billion tons of coal resources in total.

More than 500 billion tons?

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Coal miner ABM Investama says it has repaid $37.8 million of its debt to two lenders and wants to improve its capital structure.

The company repaid Rp 225 billion ($24.8 million) to Bank Permata and $13 million to DBS Bank in Singapore, Achmad Ananda Djajanegara, managing director of ABM Investama, said in a statement to the Indonesia Stock Exchange (IDX) on Tuesday.

“In line with our original plan, we allocated approximately 24 percent of the proceeds from the IPO to repay the company’s debt to the two banking institutions,” Achmad said.

Shares of ABM Investama strengthened 7 percent to Rp 3,825 on the IDX on Tuesday.

The Jakarta-based coal miner, controlled by the wealthy Hamami family, raised Rp 2.1 trillion in an initial public offering last November. ABM Investama sold 550.6 million shares, 20 percent of the company. It has said that it would offer Rp 600 billion of the proceeds to its parent company, Tiara Marga Trakindo.

The remaining Rp 1.5 trillion would be used to refinance its debt and boost business at its subsidiaries.

“The company repays the debt before maturity in order to reduce the interest burden of loans and improve the company’s capital structure, so that we can optimize the funds available for businesses to strengthen our operating subsidiaries,” Achmad said in the statement.

ABM Investama had spent Rp 184 billion to expand its subsidiary Reswara Minergi Hartama, Achmad said.

Reswara controls three coal mining concessions in Aceh and South Kalimantan that have more than 500 billion tons of coal resources in total. ABM Investama is aiming to double its coal production this year to at least 5 million tons with the bulk of the product are sold in spot market, it said last year.