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PLN prepares Rp 10t in assets for securitization
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Two employees of PLN work at a power plant complex. (Kontan/Cheppy A. Muchlis)
S
tate-owned electricity firm PLN is assessing assets worth between Rp 5 trillion (US$375 million) and Rp 10 trillion for securitization in order to generate cash.
Securitization is the process through which a variety of financial and non-financial assets are packaged into securities for sale to investors. The cash flows produced by the underlying assets are used to pay for the principal and interest on the securities.
This way, firms can obtain fresh funding to spur development through maximizing their assets.
(Read also: PLN to issue $3 billion in bonds in May)
PLN on Friday held an event attended by its board of directors to introduce the securitization plan and determine what kind of measures needed to be done inside the company to implement the plan, PLN president director Sofyan Basir said on the sidelines of a media gathering in Bogor, West Java, recently.
"[The securitization] is being planned. It's not completed yet," he said, adding that several power plants, such as the Suralaya power plant in Banten, were being prepared to be securitized.
"We are assessing the total amount [of the assets]," he said. "We’re asking for around Rp 5 trillion to Rp 10 trillion worth of assets [to be securitized]."
Another state-owned enterprise set to raise funds through asset securitization is toll road operator PT Jasa Marga, which has prepared two assets that will be divested as part of the process. (bbn)
