Shipping companies seek public funding

Riska Rahman


Publicly listed shipping companies are seeking extra funding through the issuance of bonds and other capital market instruments to finance their business expansion projects

Shipping companies PT Buana Lintas Lautan and PT Humpuss Intermoda Transportasi have each secured approval from their respective shareholders to issue rights shares and bonds to raise additional funds for financing their expansion project this year. 

During a general shareholders meeting on Thursday, Buana Lintas Lautan's shareholders approved the comapny's plan to issue right shares to raise fresh fund for an expansion. Commercial Director Henrianto Kuswendi said the company planned to issue 3,4 billion new shares, which will account for 31,78 percent of its enlarged shares.

He further explained that the company planned to buy 16 more oil and gas tankers this year as part of its plan to focus more on oil and gas transportation. The increase in revenue, coupled with its efforts to reduce costs, allowed the company's profit to increase 58.16 percent to $13.51 million last year.

Meanwhile, another publicly listed shipping company, PT Humpuss Intermoda Transportasi, also secured its shareholders' permission to seek funding through a bond issuance. Chairman Theo Lekatompessy said his company was seeking Rp. 1 trillion from bond issuances that would mostly involve the rupiah and the US dollar. He said that, currently, the company's bond offering was being assessed by credit rating agency Fitch Ratings and hoped that it could be issued in the first half of this year.

He said the money would be used to buy five new ships, comprising one oil and gas tanker, one chemical tanker, one dredger ship and two floating storage regasification units (FSRUs). The FSRUs, he continued, would support the firm;s liquefied natural gas (LNG) distribution business as it planned to expand to a new line of business of energy distibution in the long run. The company currently holds a majority market share in the chemical and LNG shipping business in the country and holds less than a 5 percent market share in the oil shipping business.

Souce: The Jakarta Post.