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Business Times
5 hours ago
- Business
- Business Times
Indonesia's sovereign wealth fund Danantara seeks up to US$10 billion loan: sources
[JAKARTA] Indonesian sovereign wealth fund Danantara is seeking a multicurrency borrowing of as much as US$10 billion, in what could be South-east Asia's largest loan, according to people familiar with the matter. Danantara, formally known as Daya Anagata Nusantara, sent a request for proposals to regional and international banks for a loan with tenors of around three to five years, the people said, who asked not to be identified discussing private matters. Lenders have been asked to provide underwritten commitments and proposals on an uncommitted basis, they added. The loan will be unsecured and will not carry any guarantee nor come with letters of comfort or support from the government, the people said, adding that proceeds will be for general corporate purposes. Danantara did not immediately respond to requests for comment. The fund, which reports directly to President Prabowo Subianto, is a core component of the president's vision to propel South-east Asia's largest economy to 8 per cent growth during his presidency. With Indonesian state-owned enterprises under its supervision – including some of the nation's largest banks, oil and gas giant PT Pertamina and the holding company for the government's mining interests – executives have suggested the fund will have more than US$1 trillion in assets. However, many of the details about how Danantara will operate are 'understandably' still unclear given its infancy, making it tricky to discern both the risks and the upsides, said Nicolas Painvin, global head of international public finance at Fitch Ratings in an interview with Bloomberg News in May. Earlier this month, Danantara's managing director Arief Budiman said that the sovereign wealth fund plans to invest in projects from eight sectors, including renewables, digital infrastructure and healthcare. The largest Indonesian loan was from the government itself, which raised a 3 billion euros (S$4.5 billion) facility in September 2023, according to Bloomberg-compiled data. The biggest borrowing from South-east Asia is a US$9.75 billion bridge loan that had backed a Singapore consortium's acquisition of soft drinks producer Fraser & Neave in November 2012, the data showed. The International Financing Review, or IFR, first reported on Danantara's loan. BLOOMBERG
Business Times
6 hours ago
- Business
- Business Times
Indonesia's sovereign wealth fund Danantara seeks up to $10 billion loan: sources
[JAKARTA] Indonesian sovereign wealth fund Danantara is seeking a multicurrency borrowing of as much as US$10 billion, in what could be South-east Asia's largest loan, according to people familiar with the matter. Danantara, formally known as Daya Anagata Nusantara, sent a request for proposals to regional and international banks for a loan with tenors of around three to five years, the people said, who asked not to be identified discussing private matters. Lenders have been asked to provide underwritten commitments and proposals on an uncommitted basis, they added. The loan will be unsecured and will not carry any guarantee nor come with letters of comfort or support from the government, the people said, adding that proceeds will be for general corporate purposes. Danantara did not immediately respond to requests for comment. The fund, which reports directly to President Prabowo Subianto, is a core component of the president's vision to propel South-east Asia's largest economy to 8 per cent growth during his presidency. With Indonesian state-owned enterprises under its supervision – including some of the nation's largest banks, oil and gas giant PT Pertamina and the holding company for the government's mining interests – executives have suggested the fund will have more than US$1 trillion in assets. However, many of the details about how Danantara will operate are 'understandably' still unclear given its infancy, making it tricky to discern both the risks and the upsides, said Nicolas Painvin, global head of international public finance at Fitch Ratings in an interview with Bloomberg News in May. Earlier this month, Danantara's managing director Arief Budiman said that the sovereign wealth fund plans to invest in projects from eight sectors, including renewables, digital infrastructure and healthcare. The largest Indonesian loan was from the government itself, which raised a 3 billion euros (S$4.5 billion) facility in September 2023, according to Bloomberg-compiled data. The biggest borrowing from South-east Asia is a US$9.75 billion bridge loan that had backed a Singapore consortium's acquisition of soft drinks producer Fraser & Neave in November 2012, the data showed. The International Financing Review, or IFR, first reported on Danantara's loan. BLOOMBERG
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Business Standard
9 hours ago
- Business
- Business Standard
Asian banks fuel more than $2 billion loan boom across Middle East
Growing need for Middle East borrowers, primarily those from the Gulf States, to look beyond domestic capital markets comes as many regional economies press ahead with expensive diversification plans Bloomberg By Kari Lindberg and Christine Burke Middle East borrowers are ramping up loans that are being syndicated in Asia Pacific as they look to diversify fundraising beyond global bond and domestic markets. More than $2 billion of Middle East deals targeting Asian bank liquidity have launched in recent weeks, including Saudi Electricity's $1 billion loan, Banque Saudi Fransi's $750 million facility and a $500 million financing for Al Ahli Bank of Kuwait. The growing need for Middle East borrowers, primarily those from the Gulf States, to look beyond domestic capital markets comes as many regional economies press ahead with expensive diversification plans, in an environment where low oil prices are seen challenging growth and finances. 'Middle Eastern borrowers, given the significant borrowing requirements, have been much more open to diversifying their lending relationships and willing to tap into the demand from Asia,' said Amit Lakhwani, global head of loan syndicate at Standard Chartered Plc. Asia also offers opportunities to borrow in new currencies or tenors versus what is available to them in the Middle East market, he added. The volume of loans raised by Middle East borrowers in Asia Pacific touched a six-year high of $5.2 billion in 2024, according to Bloomberg-compiled data. The flurry of recent deals also follow the closing of Qatar National Bank's $2 billion borrowing in March that drew nearly 30 lenders, largely comprising Chinese, Japanese and Taiwanese banks, the data showed. Such deals have historically done well in Asia. There's a huge demand from Asian banks to join the loans of Middle Eastern borrowers given the dearth of transactions back home. The volume of syndicated facilities — denominated in the US dollar, euro and Japanese yen — slumped 30 per cent to $53 billion so far this year in Asia Pacific ex-Japan, according to Bloomberg-compiled data. That's the lowest tally in at least a decade. Moreover, not only do companies from the Middle East often have better credit ratings, but such deals are able to offer higher returns versus similarly-rated Asian entities, said Aaron Chow, managing director for loan capital markets, Asia Pacific at Sumitomo Mitsui Banking Corp. The recent five-year loan of Saudi Electricity, which is rated A+ by Fitch, pays an interest margin of around 85 basis points over the benchmark Secured Overnight Financing Rate. In contrast, the recent nearly five-year borrowing of South Korea's Shinhan Card, which is rated A by Fitch, offers margin of 80 basis points over SOFR. Still, some of these deals could experience some headwinds given that banks have internal limits on how much capital can be deployed into a specific country and sector.
Business Times
11 hours ago
- Business
- Business Times
Thai coconut water maker IFBH's shares jump in Hong Kong debut
[HONG KONG] Shares of Thai coconut-water maker IFBH rose as much as 67 per cent on their first day of trading in Hong Kong following a HK$1.16 billion (S$188 million) initial public offering (IPO), the latest sign of renewed vigour in the city's equity capital market. The stock jumped to as high as HK$46.50 in early morning trading after it was priced at HK$27.80 per share, the high end of its marketed range. The deal attracted robust demand as it was 2,682 times oversubscribed, which was bolstered earlier by high margin financing from retail investors for the shares. Its cornerstone investors included UBS Asset Management and Black Dragon. The IPO will help the company's ambition to expand its business in China, where it says it already boasts a leading market share. It also adds to a growing list of companies listing in Hong Kong, whose IPO market has shaken off years of sluggishness to stage a strong comeback as investors move to diversify. 'The ready-to-drink soft drink market in Greater China holds growth potential,' according to Tina Banerjee, an independent analyst who publishes on Smartkarma. IFBH's 'market leadership position provides it ample room to keep costs under control'. IFBH's revenue rose 80 per cent in 2024, primarily due to a sales increase in mainland China, according to its prospectus. The country accounts for more than 92 per cent of its total sales, it said. The company's 2024 sales growth outpaced that of some of its main competitors, including Vita Coco and Hainan Yedao, according Bloomberg-compiled data. Its rapid growth can be attributed its 'light asset' model that calls for outsourcing production and packing to others, according to Banerjee. Part of the IPO proceeds will be used to support its business in China, where the ready-to-drink soft beverage market is expected to expand at a compounded annual growth rate of 7.1 per cent by 2029, according to the company. The company also plans to expand to other regions, including Australia, the Americas and South-east Asia. Citic Securities was the sole sponsor for IFBH's listing in Hong Kong. BLOOMBERG
Business Times
15 hours ago
- Business
- Business Times
Asian banks fuel more than US$2 billion loan boom in Middle East
[HONG KONG] Middle East borrowers are ramping up loans that are being syndicated in Asia-Pacific as they look to diversify fundraising beyond global bond and domestic markets. More than US$2 billion of Middle East deals targeting Asian bank liquidity have launched in recent weeks, including Saudi Electricity's US$1 billion loan, Banque Saudi Fransi's US$750 million facility and a US$500 million financing for Al Ahli Bank of Kuwait. The growing need for Middle East borrowers, primarily those from the Gulf States, to look beyond domestic capital markets comes as many regional economies press ahead with expensive diversification plans, in an environment where low oil prices are seen as challenging growth and finances. Saudi Arabia is running a fiscal deficit, with oil prices being far below the level of US$92 a barrel, the International Monetary Fund says it needs to balance its budget. That's led to the government and Saudi companies ramping up borrowing to fund Crown Prince Mohammed bin Salman's US$2 trillion transformation programme. Meanwhile, Qatar, Kuwait and the United Arab Emirates are among others that have agendas that will require heavy investment over several years to diversify revenues away from traditional energy sources. 'Middle Eastern borrowers, given the significant borrowing requirements, have been much more open to diversifying their lending relationships and willing to tap into the demand from Asia,' said Amit Lakhwani, global head of loan syndicate at Standard Chartered. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Asia also offers opportunities to borrow in new currencies or tenors versus what is available to them in the Middle East market, he added. The volume of loans raised by Middle East borrowers in Asia-Pacific touched a six-year high of US$5.2 billion in 2024, according to Bloomberg-compiled data. The flurry of recent deals also follow the closing of Qatar National Bank's US$2 billion borrowing in March that drew nearly 30 lenders, largely comprising Chinese, Japanese and Taiwanese banks, the data showed. Such deals have historically done well in Asia. There's a huge demand from Asian banks to join the loans of Middle Eastern borrowers, given the dearth of transactions back home. The volume of syndicated facilities – denominated in the US dollar, euro and Japanese yen – slumped 30 per cent to US$53 billion so far this year in Asia-Pacific ex-Japan, according to Bloomberg-compiled data. That's the lowest tally in at least a decade. Moreover, not only do companies from the Middle East often have better credit ratings, but such deals are able to offer higher returns versus similarly-rated Asian entities, said Aaron Chow, managing director for loan capital markets, Asia-Pacific at Sumitomo Mitsui Banking. The recent five-year loan of Saudi Electricity, which is rated A+ by Fitch, pays an interest margin of around 85 basis points over the benchmark Secured Overnight Financing Rate. In contrast, the recent nearly five-year borrowing of South Korea's Shinhan Card, which is rated A by Fitch, offers a margin of 80 basis points over SOFR. Still, some of these deals could experience some headwinds given that banks have internal limits on how much capital can be deployed into a specific country and sector. BLOOMBERG
