Viva aims at foreign investors for private placement
PT
Visi Media Asia (VIVA), the media group belonging to tycoon Aburizal Bakrie, is
considering selling 10 percent shares of its subsidiary Intermedia Capital
(IMC) in a private placement, in the hope of raising US$105 million to
refinance its debts. VIVA was looking for ways to restructure its debt to the
Singapore-chapter of Swiss bank Credit Suisse. The shares to be allotted are
those of IMC, the operator of free-to-air television station ANTV. VIVA opted
to release 10 percent of IMC shares as the subsidiary still had a lot of
opportunities in the fund-raising plan, given that VIVA still dominated
ownership in the newly-listed company.
VIVA holds about a 90 percent stake in IMC,
while the public owns 10 percent of the shares. By releasing 10 percent of IMC
shares, VIVA hoped to pool $105 million to pay off almost half of its remaining
debt to Credit Suisse. VIVA entered into a $230 million credit agreement with
Credit Suisse in November last year. The proceeds of the loan were used to
repay its outstanding loans, boost its liquidity, and for its working capital
and capital expenditure (capex).
VIVA
had previously planned to pay off some of the debt from the funds raised in
IMC’s initial public offering (IPO) in April, but the money generated from the
subsidiary’s public debut was far below the holding company’s expectations. VIVA
targeted to earn a maximum Rp 1.13 trillion ($109.58 million) from the public
offering, of which 10 percent had been allocated to refinance its loans, but it
ended up reaping only Rp 541.17 billion.
Due
to the unsatisfying IPO result, VIVA must explore other potential avenues to
refinance the remaining $220 million debt. Such avenues include issuing bonds
and seeking domestic loans for refinancing, besides the private placement. Viva
has prepared Rp 900 billion for capex this year, a significant increase compared
to Rp 400 billion last year. The capex would be used to finance the company in
building new television studios and developing its online streaming platform
VIVALL and pay television service VIVA . VIVALL was launched in May and has
generated about 600,000 subscribers with 1.3 million screen views from Android
and iOS.
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