Ancora mulls rights issue

IDX-listed Ancora Indonesia Resources Tbk is mulling to launch rights issue to raise funds to help strengthen the balance sheet of its subsidiaries currently suffering from the downturn in coal and oil and gas industries, Bisnis Indonesia reported on Thursday.

The paper quoted Charles D. Gobel, Ancora Director, as saying that the rights issue is seen as an option as it would be difficult to get new loans. ?It will be quite difficult to get new loans. Probably it would be rights issue. We?re still calculating the size of funds, particularly to restructure (the debts) of subsidiaries,? he said.

Ancora has four subsidiaries including explosives maker PT Multi Nitroma Kima (MNK), oil and gas services company PT Bormindo Nusantara, PT Ancora Shipping, and PT Ancora Indonesia Mining.

Elsewhere, Charles said that given the lingering downturn in the coal and oil and gas industries, the company expects lower revenue this year at US$110 million-$120 million, compared to last year?s consolidated revenue of $125 million. ?Revenue of Bormindo will decline, while MNK?s stagnant,? he said.

This year, the company has allocated $2 million for capital expenditure. Ancora plans to start operation of its detonator manufacturing facility, with production capacity of 2 million units per year, in August. (*)