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25 December 2009
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Indonesia’s Mitra to divest part of stake in newly acquired firm

Indonesia’s publicly listed PT Mitra International Resources, an integrated oil and gas firm, plans to sell some of its shares in PT Apexindo Pratama Duta in 2010 to partly repay its debts of more than 8.2 trillion rupiah ($862 million), the Jakarta Post reported.

Mitra International Resources, formerly known as Mitra Rajasa, acquired 98.14 percent of the shares in Apexindo in late 2008 through the mobilisation of $500 million in loans, in a move that put a heavy debt burden on its financial balance and contributed largely to the company suffering a significant net loss in the January-September period this year.

To help ease that burden therefore, the company plans to sell part of its stake in Apexindo next year, according to Mitra director Inu Dewanto Koentjaraningrat.

Inu, speaking in a public expose on Wednesday, said that the company “had not intended to own that many shares in Apexindo” in the first place. He did not however elaborate on the volume of shares to be divested next year as part of the divestment deal and associated moves.

In addition to the divestment plan, Inu said Mitra was also planning to restructure its debt next year. “We target to slash our debt to around $350 million after the restructuring and Apex divestment,” he added.

According to him, Apexindo contributed more than 90 percent of Mitra’s revenue in 2009. The acquisition of Apexindo, one of the largest oil and gas service companies in Southeast Asia, has shifted the focus of Mita’s core business from the transportation sector to oil and gas.

Apexindo booked $170 million in revenue in the third quarter of 2009, down from the $182.5 million registered a year earlier. But net profits increased by 28.4 percent to $46.7 million from $36.4 million recorded in the same quarter in 2008.

Mitra, on the other hand, posted a 641,1 billion rupiah net loss, as against 64.2 billion rupiah in net profits in the same quarter a year earlier. Inu said the loss was due to the company having to pay interest on debts, the biggest being the loan from the Apexindo acquisition.

“One of our subsidiaries also had to pay interest of around 124 billion rupiah; we also had amortisation debt of around 250 billion rupiah,” he added. Inu also said that Apexindo would spend a modest $15 million in capital expenditure in 2010.

“Mitra will also spend $25 million on the refurbishment of our FPSO [Floating Production Storage and Offloading facilities] and another $1 million or $2 million for other capital spending,” he said.


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