Trump’s Indonesia Partner Gets Approval for Distressed Debt Plan
(Bloomberg) -- PT MNC Investama, an Indonesian media and property conglomerate that has a tie-up with former President Donald Trump’s company, said it received court approval for its debt plan after agreeing to lower its standalone borrowings by 65%.
The approval by the High Court of Singapore paves the way for the company founded by tycoon Hary Tanoesoedibjo to issue new notes and shares for investors of its distressed bonds as it restructures its debt.
Under the agreement, MNC Investama will cap its debt at $81 million, it said. Holders of its distressed $231 million bonds will decide whether to accept new shares or new notes, it said in a statement.
At least 65% of bondholders are expected to convert their bonds to new shares, which will be issued within 12 months of the plan’s effective date, the company said. MNC Investama’s standalone equity will increase about 18% to at least 14.5 trillion rupiah ($1 billion), it said.
Other holders can choose to exchange their bonds for new five-year notes issued with an annual fixed coupon of 1%, with an additional variable coupon based on the cash dividend income MNC Investama receives from units PT Global Mediacom and PT MNC Kapital Indonesia.
“There will be direct financial benefits such as the reduction of standalone debt, capital strengthening, and lower finance costs borne by the company,” MNC Investama President Director Darma Putra said in the statement.
The debt arrangement will allow the company to grow faster and continue its digitalization plan for its business units, Putra said.
Tanoesoedibjo had previously sought to extend the maturity of the company’s dollar bonds, which were due in 2021, as the pandemic strained finances.
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