PT Central Proteinaprima mandates Barclays

The Indonesian shrimp producer readies a debut dollar bond which is rumoured to be a five-year $250 million offering.
PT Central Proteinaprima (CPP), one of the worldÆs largest vertically-integrated shrimp producers and processors, has mandated Barclays Capital as sole bookrunner for its proposed Reg-S, 144a US-dollar senior secured bond. The bookrunners have not specified the issue size or tenor, although there is talk of a five-year $250 million offering, marking the companyÆs debut in this market.

Having just completed a non-deal roadshow, CPP is due to conduct investor presentations in Singapore tomorrow, and Hong Kong, London and New York on June 15, 18, and 19.

Fitch Ratings today assigned a long-term foreign currency issuer default of B+. CPP has become increasingly leveraged as a result of the ongoing acquisition of Dipasena group of companies, says the report. The latter is a distressed shrimp-farmer for which CPP will pay up to Rp700 billion ($77 million), spending an additional Rp500 billion ($55 million) to revive its assets. A majority of these costs will be debt funded, according to the report, leading to an increase of its debt-to-Ebitda level. The company also needs to address distressed debt levels that are considerably larger than its asset base.

According to, CPP also hopes to raise funds via an IPO, some of which will be used to repay a short-term debt to Barclays Capital, from which it received a $250 million loan. In June last year, the company had planned to raise Rp432 billion ($47 million) by selling 2.2 billion shares but fired its investment bank PT Danareksa Sekuritas after the share sale failed.

CPP were the first to establish modern shrimp farming facilities and are now the market leader in shrimp feed, fish feed, and poultry feed. In 1995, a viral disease destroyed most of Indonesia's shrimp production and in 2003 the Indonesian government planned to drastically increase its shrimp production by converting 320,000 hectares of new land into shrimp farms. The plan (Protekan 2003) transformed Indonesia's traditional shrimp farming into a modern, intensive system.

CPP's products also include frozen shrimp, shrimp fry, probiotics, and poultry day-old chick farming. The company owns more than 16,000 hectares of dedicated land in several locations worldwide, providing jobs for 20,000 people, including 6,000 full-time employees.

PT Central Proteinaprima's total assets as at December 2006 stood at Rp2.52 trillion ($277 million), up from Rp1.46 trillion ($160 million) in 2005.
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