Pertamina shortlists six underwriters for bonds issue

State owned oil and gas company Pertamina has shortlisted six investment banks to take part in the final selection of underwriter for a planned US$500 million eurobond issue, Bisnis Indonesia daily reported on Tuesday.

"From the existing 11 candidates, only six were chosen to take part in the final bid, " a source said. The six securities companies include Credit Suisse First Boston (CSBF), Morgan Stanley, UBS Warburg, Citigroup Securities, JP Morgan Securities and Deutsche Securities.

However, the source said that the inclusion of CSFB in the shortlist had raised a question among other candidates because the company did not attend the earlier presentation. Like other candidates CSFB had submitted its bid before the deadline but it failed to appear during the initial presentation.

Pertamina has estimated that the coupon of its euro-bonds would carry an interest rate of between six percent and seven percent per annum. Proceeds from the bonds issue will be used to partly finance the oil and gas company's expansion plan which is expected to reach about US$1 billion.

Other funding sources for the expansion will come from internal own fund and export credits. (*)