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Thursday, February 26, 2009

Indonesia's Matahari plans sukuk, conventional bonds

JAKARTA, Feb 25 (Reuters) - Indonesian retailer PT Matahari Putra Prima Tbk (MPPA.JK) said on Wednesday it plans to raise a total of 500 billion rupiah ($42 million) from the sale of Islamic and conventional bonds in April.

The world's most populous Muslim nation is trying to tap its huge market for Islamic-compliant products. The government recently raised 5.55 trillion rupiah from its first retail sukuk issue, well above the 1.7 trillion rupiah targetted.

In a prospectus published in a newspaper, Matahari said it plans to sell 200 billion rupiah of ijarah sale-and-leaseback sukuk and 300 billion rupiah of conventional bonds.

It has appointed PT HSBC Securities Indonesia, PT Indo Premier Securities, and PT Ciptadana Securities as underwriters.

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 = 11,930 rupiah) (Reporting by Dicky Kristanto, editing by Sara Webb)

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