Indonesian garment maker PT Pan Brothers Tbk, or PBRX, has begun approaching lenders to refinance its $138.4 million syndicated loan due December 2023, said two sources familiar with the matter.
The originally up to $150 million revolving credit facility was restructured and restated from an effective date of June 30, 2022, and comprises a $123.4 million Facility A and a $15 million Facility B. The facility was amended through the restructuring with a one-year extension option and matures on Dec. 31, 2023, as the extension option was exercised. It would have matured on Dec. 31, 2022 if the extension option had not been exercised.
Pan Brothers’ vice president director Anne Sutanto told Reorg the syndicated facility was automatically extended because the company was in compliance with terms under a new agreement with creditors signed in June 2022. Indicative binding restructuring terms for the loan are available
HERE.
The originally up to $150 million RCF was arranged by PT Bank ANZ Indonesia, PT Bank HSBC Indonesia and ING Bank N.V., Singapore Branch, and amended on April 10, 2018 and Oct. 29, 2018,
as reported.
Lenders to the $123.4 million working capital Facility A, which pays 3% to onshore lenders and 2.5% to offshore lenders, now comprise PT Bank KEB Hana Indonesia, PT Bank Maybank Indonesia, PT Bank BNP Paribas Indonesia, PT Bank China Construction Bank Indonesia, PT Bank Rakyat Indonesia, PT Bank Shinhan Indonesia, SC Lowy Primary Investments Ltd. and SC Lowy Financial (HK) Ltd., according to
Pan Brothers’ financial statements for the year ended Dec. 31, 2022. Lenders to the $15 million working capital Facility B now comprise Rakyat Indonesia, Singapore Branch and SC Lowy Primary Investments, the same financials show.
The company was compliant with financial ratio covenants on the loan as of Dec. 31, 2022, which comprise the ratio of current assets to current liabilities of not less than 1.1:1; a net debt to equity ratio of not more than 2:1; a net debt to EBITDA ratio of not more than 5.5:1; and the ratio of EBITDA to finance charges being not less than 2.25:1, according to the same financials.
Pan Brothers is expected to approach predominantly local banks for the refinancing, but would also be expected to approach state-owned Indonesian banks for support with the refinancing, according to a third source with knowledge of the matter.
Indonesian sub-investment grade borrowers have been forced to turn to the local bank credit market to refinance debt, after a series of restructurings - including
Delta Dunia Merlin Textile (Duniatex),
PT Sri Rejeki Isman Tbk (Sritex) and Pan Brothers - led to heavy losses for lenders. The outfall from Covid-19 also led international banks to focus their attention more on lending to the investment grade space to minimize risks, according to loan markets sources.
Indonesian borrowers that have turned to the local bank market include palm oil producer
Sawit Sumbermas Sarana Tbk, which signed an around IDR 3.6 trillion ($241.16 million) term loan with local banks led by Bank Rakyat Indonesia and Bank Syariah Indonesia, which was used to fund a tender offer to repurchase its then outstanding $300 million 7.75% senior notes,
as reported.
Property developer and retail mall operator
Agung Podomoro Land (APLN) had engaged with local banks as it looked to finance a deal for the sale of Central Park Mall to repay a SGD 172.8 million ($130 million) senior secured financing from Guthrie Ventures Pte. Ltd.,
as reported. CIMB Niaga, the Indonesian branch of Malaysia’s CIMB Bank Bhd., had earlier sounded the local bank market on a syndicated loan to back the buyout,
as reported, before borrowing IDR 1.9 trillion through PT Bank Danamon Indonesia, a consolidated subsidiary of MUFG Bank, after Japan’s Hankyu Hanshin emerged as the buyer for a majority of the mall,
as reported.
Indonesian industrial real estate developer
PT Kawasan Industri Jababeka in late 2022 also signed an around $100 million term loan with PT Bank Mandiri before launching an
exchange offer and consent solicitation process for its $300 million 6.5% notes due October 2023,
as reported.
Indonesian property and healthcare conglomerate PT Lippo Karawaci Tbk raised an up to
IDR 6 trillion seven-year bank facility for a tender offer related to its originally $420 million 8.125% due January 2025 and originally $425 million 6.75% due October 2026 notes, as reported. Bank Negara Indonesia and Bank CIMB Niaga were the mandated lead arrangers and bookrunners for the facility,
stock exchange filings show.