TPIA: Capex worth USD 430 Million Build Factory
TPIA: Capex worth USD 430 Million Build Factory. Chandra Asri Petrochemical, Tbk (TPIA) allocates a capital expenditure (capex) worth USD 430 Million in 2020. The allocation of this capex increase by about 19% compared to the 2019 budget. Director of TPIA Suryandi said, Capex is focus for the development of the factory Chandra Asri Perkasa II worth USD 330 Million, and the rest allocation for the maintenance.
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As well as TPIA, or subsidiary of Barito Pacific, Tbk (BRPT), set up a USD 5 Billion mega project. The process is currently in the selection phase of four potential strategic investors. Among them are Mubadala Investment Co, and OMV Aktiengesellschaft. Beginning in 2020, TPIA will announce a strategic investor identity that will help build the plant with a total productions capacity of 4 million tonnes.
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Furthermore, the next stage, TPIA will make the financing structure of Engineering Procurement and Construction (EPC) to 4Q20. Thus, the factory of Chandra Asri Perkasa II will begin to be built at the end of 2020 or early 2021. Then in 2024, the plant was target to start operations. During the financing and EPC process, TPIA will be holding rights issue.
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Moreover, TPIA plans to issue 7.2 billion new shares. Using the assumption, the closing price is IDR 10,475 per share, TPIA is likely to get fresh funds around IDR 7.5 Trillion. As such, the general meeting of shareholders regarding the rights issue plan will be conduct on February 2020. If approve, TPIA has a 12 month period since the general meeting of shareholders to execute rights issue which gives the effect of the 29% stock dilution.
Finance Director TPIA Andre Khor said, rights issue is a financial strategy development factory Chandra Asri Perkasa II. Last, TPIA corporate actions have an equity base, or will be combine with a loan.
