Gresik announces new investments, bond issue, Indonesia

Indonesia’s largest cement producer, PT Semen Gresik, plans to invest up to US$600,000 on five cement packing plants to be constructed in a number of locations on the island of Kalimantan.

Finance director of the company, Ahyanizzama, was quoted by Asia Pulse as saying that construction of these facilities is set to start in the second quarter of this year and will be completed in 16 months. He said the investment is part of the company’s capex plans of IDR5.5trn for this year.

Ahyanizzama also noted that Gresik has similar plans for the island of Sumatra where it plans to build packing plants and special ports.

Meanwhile, the company separately stated that it may issue bonds valued at US$540m in the second half of this year. These large funds will be required to build two plants, one in Central Java and the other in Sumatra, Ahyanizzama told local press. He said the company is also considering medium term notes (MTN) instead of bonds. The bond or MTN would fund up to around 50 per cent of the total investment, he said.