Indonesia's United Tractors plans $390 mln rights issue

JAKARTA (Thomson Financial) - Indonesia's biggest heavy equipment
distributor, PT United Tractors Tbk, said over the weekend it is planning
a rights issue in the third quarter to raise about $390 million to repay
debt and for expenses.

Under the plan, shareholders of every six existing shares are entitled to
buy one new share at 7,500 rupiah ($0.68) each.

The rights issue is subject to shareholders' approval at a meeting on Aug.
19.

United Tractors is majority owned by conglomerate PT Astra International
Tbk, which will act as the standby buyer for the rights shares not taken
up by other shareholders.

It said it will use the proceeds to repay existing debt, to finance
working capital, and capital expenditures. It said the capital spending
may include the future acquisitions of mining assets in Kalimantan,
Sulawesi, and Sumatra. Such proposed spending could also be in the form of
loans injected into its mining contracting unit PT Pamapersada Nusantara.

UBS Investment Bank is the sole financial adviser to the rights issue.




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