Cement maker PT Holcim Indonesia said Tuesday it is proposing to borrow funds to prepay some of its US$214.71m debt.
Holcim is seeking to obtain a new loan of US$135m from Cemasco or other Holcim AG-affiliated firms, on top of a US$60m loan from two local banks.
The plan will be submitted to shareholders for approval at a meeting scheduled for December 18.
The US$214.71m debt is part of the loans that were restructured in 2001. Under the restructuring agreement reached with creditors, Holcim Indonesia is allowed to undertake certain corporate actions such as obtaining new loans, distributing dividends and embarking on new investments.
The company said Indonesia’s cement industry has improved significantly over the past few years as indicated by the rise in domestic cement consumption and supported by lower domestic interest rates.
"In order to take advantage of these changes, the company is proposing to its independent shareholders to replace the existing debts with new debts, which are more flexible and have easier terms and condition," it said.