June 7, 2007

 

CP Prima issues US$200 million bond

 

 

PT Central Proteinaprima Tbk (CP Prima), the Indonesian shrimp subsidiary of Thai agri-giant CPF is issuing exchangeable bonds of US$200 million to finance the acquisition of PT Dipasena.

 

The company won control of PT Dipasena from the Indonesian government after the government tendered for buyers. Among the conditions issued was that the winner would have to invest US$200 million into the company. CP Prima paid IDR688.12 billion (US$77.2 million) for the company.

 

The company will issue the bonds through special purpose vehicle with BNP Paribas as underwriter for the bond issuance.

 

CP Prima is a shrimp company producing frozen shrimp, shrimp-fries, fish food and animal feed. The company exports more than 90 percent of the frozen shrimp to the US, Japan and Europe.

 

CP Prima, the leader of Neptune Consortium, just won the tender to acquire 100% stake of Dipasena at from the State Assets Management Corp (PPA).

 

The corporate secretary of CP Prima confirmed the bonds issuance plan.

 

Analysts have rated CP Prima stocks a strong buy due to the aggressive expansion of the company.

 

CP Prima plans to more than double production by 150 percent to 186,640 tonnes a year from 74,700 tonnes presently.

 

Expansion plans in the pipeline would cost CP Prima about US$120 million and the plan to increase production capacity would cost US$48 million.

 

The expansion would comprise the main area of growth in the company amid high demand from the US.

 

CP Prima's revenue may rise to IDR7.6 trillion in 2009.

 

The company is moving to produce frozen shrimp with value added products, and hoping to expand the share of revenue this category creates from 67 percent to 80 percent.