CFSB and UBS vie for Medco’s $100 million bond underwriter job

Leading securities firms Credit Suisse First Boston (CFSB) and UBS Securities are strong contenders to become underwriters for Indonesia’s largest listed oil and gas firm PT Medco Energi International Tbk’s forthcoming US$100 million bond issue, Bisnis Indonesia newspaper reported in its Tuesday edition.

“Medco will use the proceeds of around US$100 million from the bond issue to finance the acquisition of other oil and gas blocks this year, “ revealed one source to Bisnis.

According to the source, Medco would need the additional funds as its cash resources would be allocated to finance the planned acquisition of Australia's Novus Petroleum, which is estimated to cost at least US$266 million.

When Bisnis asked for confirmation, Medco’s Investor relations chief Gamala V. Katoppo said he couldn’t comment on who will become joint lead manager of the bond issue.

“Medco is considering bond issue and project financing for the acquisition of attractive oil and gas blocks during this year. We didn’t want it like last year. If any oil and gas block is available for acquisition, we will search for external financing so that there will not be interest burden,” Gamala said.

He said Medco has enough funds for the acquisition of Novus. (*)