Indonesia's largest bank leads syndication credit to fertilizer company

JAKARTA-
Indonesia's largest bank, Bank Mandiri, was appointed to lead a syndication credit, worth 490 million U.S. dollars, for PT Pupuk Kalimatan Timur (Pupuk Kaltim),the country's biggest fertilizer manufacturer, local media detikcom reported on Monday.

The fund is aimed to refinance construction of Kaltim-5 project with capacity of 2,500 Metric Tons per Day (MTPD) of ammonia and 3,500 MTPD of urea in Bontang of West Kalimantan, Agus Martowardojo, the bank's president director, was quoted by the report as saying.

The total investment for the project is 700 million U.S. dollars, according to the report.
"The syndication credit is expected to be an important momentum to support government program of fertilizer company revitalization for the sake of the country's food resilience," said Agus here.

He said that local and foreign banks have expressed their intention to participate in the syndication.
There is an annual demand of 10 million tons of fertilizer in the country, however, the domestic companies can only produce 7 million tons a year.

The Pupuk Kaltim's president director Hidayat Nyakman said the project is one effort to increase Indonesia's fertilizer production capacity. The project will replace the aging and inefficient Kaltim -1.

Hidayat said that of the total investment of 700 million, his company expects 70 percent (490 million dollars) from banking finance and the rest (210 million dollars) from its internal fund.