Semen Indonesia has announced that it has signed an offtake agreement with its Vietnamese subsidiary Thang Long Cement Company (TLCC) to help refinance its US$140 million debts. According to company officials, the debts were sourced from several lenders and were granted before Semen Indonesia took over the Vietnamese business. In an official statement, the cement giant noted that the agreement, which will be valid for six years, would help to strengthen the company’s financial ability to restructure its debts.
Agung Wiharto, Semen Indonesia’s Corporate Secretary, told local press that TLCC is obliged to pay installments of US$7 million every three months for five years to pay off its debts. In order to do this, the company must export around 140 000 t of cement during the period. As part of the agreement, Semen Indonesia will purchase and resell TLCC’s products if it does not meet its export target.
TLCC’s 2.3 million tpa capacity accounted for around 7.7% of Semen Indonesia’s total production capacity of 30 million tpa in 2013.
Edited from various sources by Rosalie Starling
Read the article online at: https://www.worldcement.com/asia-pacific-rim/30062014/semen_indonesia_signs_refinancing_agreement_with_vietnamese_subsidiary_3/