PGN expects to decide on bond arranger this month

State gas distribution company PGN said on Tuesday it had invited five foreign financial institutions to submit proposal to arrange for the company?s bond issuance plan, and expected to be able to appoint arranger(s) this week.

?The deadline to submit proposal is Thursday, but I can not tell yet who the financial institutions are,? said PGN director of finance Djoko Pramono in a press conference. He dismissed allegation that PGN appointed arranger without holding beauty contest.

PGN has not yet publicly announced the appointment of underwriters for its US$500 million bond, which would be issued in two stages this year. Sources, however, said that joint venture securities company Credit Suisse First Boston (CSFB) and local securities houses Asia Kapitalindo Securities have been involved in the preparation of the bond issuance.

Holman Sitohang, the managing director of CSFB, said that his company had formally filed a proposal to underwrite the bond offering. But he added that CSFB had not yet sent its formal request to carry out the underwriting jobs.

Minister of state owned enterprises Laksamana Sukardi, whose office oversees PGN said that his office had received several candidates to handle the underwriting of PGN?s US$500 million bond offering. They include CSFB, Merrill Lynch, ABN Amro-Rothshild and Citigroup.

Djoko said that PGN planned to launch first US$ 250 million bonds in August-September this year, with the next launch expected six months after. He said the bond would likely be denominated in Euro. Bond proceed would be used to finance the company?s Grissik-Pagardewa gas pipeline. (godang)