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Monday, January 12, 2009

Indonesia's PLN raises 2.2 trln rph from bond sales

JAKARTA, Jan 9 (Reuters) - Indonesia's state electricity firm PT Perusahaan Listrik Negara (PLN) has raised 2.2 trillion rupiah ($201 million) from conventional and Islamic bond issues, a securities firm involved in the deals said on Friday.

Indonesia's monopoly power supplier had aimed to raise 1.5 trillion rupiah from the bond issues, to help finance investment in power transmission.

It has about 24,000 MW of generating capacity but most of its plants are old, so daily output is far below capacity.

Sonny Thendian, head of trading sales at PT Indo Premier Securities, said that investors had been attracted by the high yield and potential for bond prices to rise as the central bank continued to lower interest rates.

Bank Indonesia (BI) cut its key interest rate BIPG by 50 basis points to 8.75 percent, more than expected, on January 7.

"The highest demand came from insurance firms and pension funds," said Thendian.

PT Indo Premier Securities, PT Danareksa Sekuritas, PT Trimegah Securities Tbk (TRIM.JK) were underwriters for the issues.

PLN raised 1.44 trillion rupiah from two series of fixed-rate conventional bonds. The five-year bond, maturing in 2014, has a coupon of 14.75 percent, while the seven-year bond, due 2016, has a coupon of 15 percent.

It also raised 760 billion rupiah from two series of Islamic bonds, or sukuk, which were issued under the "ijarah" or leasing arrangement.

One series, due in 2014, has a coupon of 14.75 percent, while the other series, due in 2016, has a coupon of 15 percent.

Islamic bonds do not pay interest, which is banned as usury under Islamic law, and are structured as profit-sharing or rental agreements underpinned by physical assets. ($1 = 10,950 rupiah) (Reporting by Sonya Angraini; Editing by Sara Webb)

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