Lippo Karawaci grabs IDR957 billion from shares sale

JAKARTA: PT Lippo Karawaci Tbk has issued new shares worth IDR957 billion or US$112 million through a direct placement to Lippo Group to finance the acquisition of two companies.Lippo Karawaci (LPKR) will use the proceeds to acquire a 27.24% stake in Lippo-Mapletree Indonesia Retail Trust listed in Singapore Stock Exchange and a 40% interest in asset manager of Lippo Mapletree Indonesia Retail Trust Management Ltd.The company press release yesterday showed that the two companies acquisition will propel LPKRs mall and asset management to US$4 billion (IDR34 trillion) in 3 years-4 years.Lippo Group itself has placed 1.45 billion shares owned by its affiliation, Pacific Asia Holdings Limited (PAH) at the same price per share for US$112 million (IDR957 billion) to strategic institutional investors arranged by Singapore Pte Ltd (CLSA).Earlier, the shareholders had approved to issue 1.45 billion shares at the price of IDR660 per share under the direct placement mandate to PAH raising IDR957 billion or US$112 million to fund 70.4% of its acquisition of 27.24% stake in those companies.In mid-April 2011, PAH has increased its stake in LPKR to 3.02% or 652 million shares valuing to US$52 million.Lippo Group intends to increase its stake, which reflects the companys great interest in LPKR, said LPKRs Corporate Communications Head Danang Kemayan Jati.The shareholders further investment affirms their commitment and believes to the property growth in Indonesia that projected to exceed Indonesias GDP growth, he added.In the previous 2 months, LPKR issued US$130 million senior debt or IDR1.16 trillion at maximum through Sigma Capital Pte Ltd, which was fully guaranteed by the listed developer company.Fitch Ratings agency rates the debt issuance with B+ and RR4 (recovery rating) grade.The new debt issuance will not increase Lippo Groups debt burden as one of well known developer company with a diversified revenue base, Fitch Ratings Analyst Buddhika Piyasena said. (t06/wiw)

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