16 foreign banks ready to provide US$220 million loan to Medco

Sixteen banks of Japan, Hong Kong and Singapore have voiced interest to providde loans worth US$220 million to energy firm PT Medco Energi International Tbk, Jakarta-based Bisnis Indonesia daily reported Monday.

Medco's director Sugiharto said the company had received the loan proposals from the banks following the company?s recent visits to several banks in the three countries.

?During the visits to the three countries, 21 banks voiced interests to finance the company?s expansion plan. And 16 of them, including syndicated banks, have submitted their proposals to Medco,? he said last week, adding the company has yet to make a decision over the proposals.

He noted that the main purpose of the visit was not actually looking for loans, but studying the banks? perception about Medco?s bankability.

Sugiharto said following the visits to the three countries, Medco now sees five possible sources of financing for its expansion plan, that is the syndicated banks that have submitted the loan proposals; Japanese sogo sosha including Mitsui, Mitsubishi and Sumitomo), which have been given facilities by the Japanese government to finance energy projects; other foreign banks; yankee bonds and euro bonds.

Thus far, Medco considered the ?most efficient? alternative was issuing euro bond. (*)