Pertamina Seeks $2.5 Billion Loan as Indonesia Dollar Deals Rise
(Bloomberg) -- Indonesia’s state-owned oil giant PT Pertamina is seeking a $2.5 billion short-term loan, according to people familiar with the matter, in what could be among the biggest dollar deals in the nation this year.
The borrower has mandated Mitsubishi UFJ Financial Group for the one-year loan that is being raised for working capital purposes, the people said, asking not to be identified discussing private matters. The facility will be syndicated to the broader market at a later date, they said.
A spokesperson for Pertamina didn’t immediately respond to a text message seeking comments.
Pertamina’s planned borrowing would add to a spree of dollar loans in Indonesia in the past year, and provide a test case of foreign lenders’ sentiment given the deadly protests in recent days. The nation’s markets are just recovering after the social unrest, which has subsided, sparked a selloff in stocks and bonds.
Persistent, widespread unrest may undermine Indonesia’s sovereign credit standing through weaker economic growth and strained finances, Fitch Ratings said in a note Wednesday.
The pipeline of potential deals has been building up. Pertamina’s shipping arm is seeking a separate loan of about $700 million for the construction of vessels. Meanwhile, Indonesian sovereign wealth fund Danantara has appointed banks to coordinate a multi-currency borrowing of as much as $10 billion, in what could be Southeast Asia’s largest loan.
Challenges, however, remain for Pertamina as Indonesian authorities were investigating a $17 billion graft case involving the oil giant. In July, eight suspects were detained and accused of alleged irregularities in oil purchases between 2018 and 2023, Bloomberg News reported earlier.
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