Indonesia

Indonesia’s Trikomsel Oke announced this week that it won't be able to pay interest on two Singapore dollar bonds owing to financial difficulties. If it happens, it would be the first case of default in the Singapore bond market since the global financial crisis, and is expected to rock the city-state’s debt market.

Kino Indonesia has started pre-marketing its IPO to investors, as the fast-moving consumer goods company seeks $100m to $150m from a domestic listing.

Indonesia Infrastructure Finance (IIF) has returned to the offshore loan market after more than a year for a $150m fundraising, which is backed by the International Finance Corporation (IFC).

Activity in Asia’s secondary loan market has picked up over the past few months as banks seek to manage their portfolios more efficiently. This is attracting intermediaries such as fixed income specialist SC Lowy, which has set up a par loan trading business in the region. But while there are opportunities, there are also plenty of challenges holding back growth in the nascent market, writes Shruti Chaturvedi.

AAA Oils and Fats, a trading subsidiary of palm oil processor and distributor Apical Group, is in the market for a loan of up to $130m.

Coal miner Adaro Energy, which has been in talks with its relationship banks for a loan to refinance debt, has sent out a formal request for proposals.

Poultry feed producer Charoen Pokphand (CP) Indonesia is tapping the syndicated loan market for a $355m dual-currency fundraising, split between rupiah and dollars.

A $550m three tranche borrowing for Bank Rakyat Indonesia (BRI) has launched into general syndication, but not all the mandated lead arrangers and bookrunners are looking to sell down.

Cigarette giant Philip Morris International has cut its stake in its Indonesian unit HM Sampoerna, netting a chunky Rph20.3tr ($1.38bn) in the process. The success of the trade was down to large commitments from anchor orders, who signed up for nearly half of the shares in advance.

The leads on HM Sampoerna’s Rph20.8tr ($1.4bn) follow-on have told investors that the trade is covered across the price range, after the Indonesian unit of Philip Morris International attracted a slew of long-only investors.

An evolution is happening in emerging market issuers’ use of yen funding. For many years, many of them have only been able to issue Samurai bonds by using JBIC’s GATE (Guarantee and Acquisition toward Tokyo market Enhancement) programme, but steadily more of them are stepping up to standalone issuance. At the same time, benchmark borrowers are bringing along less established issuers from the same countries in their wake

The Samurai bond market has long been a key source of returns for investors in the local market, and those investors have plenty more to look forward to. But a challenging swap market could limit issuance. Matthew Thomas reports.