Indonesian developer saves with $190m bond

Jababeka International replaces its old notes with cheaper new ones, leveraging on the rarity factor in Asian high-yield and saving over 400bp in funding costs.
Jababeka, first industrial estate developer to list on the Indonesian Stock Exchange
Jababeka, first industrial estate developer to list on the Indonesian Stock Exchange

Jababeka International, an Indonesian-based industrial developer, raised $190 million on Wednesday, exchanging its outstanding paper with the new issue to lower its cost of funds.

The five-year bond is callable in year three, with roughly $134 million in proceeds being used to redeem $175 million of bonds due in 2017, while the remaining $56 million of new cash raised will be used for general corporate purposes, according to sources close to the deal.

Jababeka’s new 144AReg S-registered offering was able to achieve a significant reduction in funding costs based on rarity factor, especially given the fact that the high-yield market continues to be dominated by Chinese...

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