Sign up | Log in



Home  >>   Daily News  >>   Indonesia News  >>   Aviation  >>   Garuda clears path for IPO
NEWS UPDATES Asean Affairs   20  December 2010

Garuda clears path for IPO

Related Stories

November 26, 2010
AirAsia Indonesia to Surpass Malaysia Business

September 23, 2010
Indonesia delays Garuda's share sales until January 2011

August 31, 2010
Airport woes in Indonesia

April 29, 2010
Indonesia, Japan sign air transport deals

April 10, 2010
Indonesia reminds Myanmar junta of need to hold tranparent elections

January 16, 2010
Five Indonesian airports ready for open sky

November 24, 2009
Indonesia puts key airport projects on priority list

Garuda Indonesia, the country's flagship airline, has finalized a debt restructuring plan with creditors in Europe, paving the way for an initial public offering.

The IPO was expected to be worth more than Rp 4 trillion (US$444 million), Garuda said in a statement released on Sunday after the European Export Credit Agency agreed to extend the maturities of about $288 million in loans to 2016.

The agency agreed to be repaid in installments of $45 million and $60 million per year.

Garuda's president director, Emirsyah Satar, said restructuring the debt was an important milestone in the company's growth plan, "particularly regarding Garuda's IPO in the near future."

Plans sell about 30 percent of the airline's equity had been scheduled for the third quarter of this year, but that was delayed as the debt deal was still in progress.

Elisa Lumbantoruan, Garuda's finance director, and David Brackenridge, creditor representative from Lloyds Banking Group, recently completed the deal in London.

Funds from the IPO, expected in February 2011, will go toward purchasing new planes, adding more destinations and improving maintenance standards.

Mandiri Sekuritas, Danareksa Sekuritas and Bahana Securities are arranging the share sale, while Citigroup and UBS AG are the international sales agents, news agencies report.

The IPO is also important to state-owned Bank Mandiri, Indonesia's largest lender, which hopes to sell its shares in the carrier.

Since 2005 Garuda has sought to restructure its debt through installation payments, repurchasing debt and debt-to-equity conversion.

Its efforts succeeded in reducing its debt, which shrank from $868 million five years ago to $464 million in November, according to the airline.

The carrier restructured $76 million of debt owed to state-run oil and gas firm Pertamina in October 2009, and in December that year it reached an agreement with Mandiri to convert Rp 967 billion of debt into a 10.61 percent equity stake.

Emirsyah said the debt agreement and share sale would make it easier for Garuda to add new destinations like India and expand its routes to Europe.

It currently flies to 31 domestic and 19 international destinations, according to its Web site.

It hopes to expand its fleet from 84 planes to 120 by 2014.

Reach Southeast Asia!
10- Nations, 560- Million Consumers
And $1 -Trillion Market
We are the Voice of Southeast Asia Media Kit
The only Media Dedicated to Southeast Asia Advertising Rates for Magazine
  Online Ad Rates

Comment on this Article. Send them to

Letters that do not contain full contact information cannot be published.
Letters become the property of AseanAffairs and may be republished in any format.
They typically run 150 words or less and may be edited
submit your comment in the box below




1.  Verifier

1. Verifier

For security purposes, we ask that you enter the security code that is shown in the graphic. Please enter the code exactly as it is shown in the graphic.
Your Code
Enter Code

Home | About Us | Contact Us | Special Feature | Features | News | Magazine | Events | TV | Press Release | Advertise With us

Our Products | Work with us | Terms of Use | Site Map | Privacy Policy | Refund Policy | Shipping/Delivery Policy | DISCLAIMER |

Version 5.0
Copyright © 2007-2015 TIME INTERNATIONAL MANAGEMENT ENTERPRISES CO., LTD. All rights reserved.
Bangkok, Thailand