Cikampek – Palimanan Toll Road

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In 1997, the Ministry of Public Works awarded a greenfield BOT contract to the consortium of PT Lintas Marga Sedaya to build a 116km highway connecting Cikampek and Palimanan in West Java. The highway was slated to connect to the existing Jakarta-Cikampek Toll Road as well as the planned Cileunyi-Sumedang-Dawuan Toll Road. It was to be the largest stretch of the 1500 km trans java toll road network. Malaysia’s PLUS Expressways Berhad purchased 55% of the shares in the project company while the remainder of the shares was held by Indonesia’s PT Baskhara Utama Sedaya. The Cikampek – Palimanan Toll Road was delayed due the economic crisis by Presidential Decree no 39 of 1997. Presidential Decree no 15 of 2002 revoked Presidential Decree no 39 of 1997, and allowed the resumption of the projects if deemed necessary by the President. In December 2005, thirteen toll road projects including the Cikampek – Palimanan were re-evaluated by the federal government. Cikampek – Palimanan Toll Road was given approval by the government and officially signed in July 2006. The project reached financial closure in July 2007 with a syndication given by 10 local banks for approximately US $555 million, the largest syndication in Indonesian toll road history at the time. The banks were: Bank Negara Indonesia (BNI), Bank Rakyat Indonesia (BRI), Panin Bank, Bank Jabar, Bank Bukopin, Bank Jatim, Bank International Indonesia (BII) and Bank DKI, with Bank Mandiri and Bank Central Asia (BCA) acting as the lead syndicators. The total project cost was estimated at US $812 million and the difference was to be financed through equity contributions from PLUS Expressways Berhad. The Indonesian government agreed to provide funds to secure right of way and to allow tariff adjustments every two years to meet inflation. In 2007, tariffs were still controlled by the government’s toll road regulator. Construction of the toll road was expected within two and a half years. Construction only started in December 2011. The government has helped in the acquisition of the 93% of the land required for the rad; the remaining 7% was mostly located in Cirebon. The project reached financial closure in September 2012 by securing US$915 million in debt from 22 banks and financial institutions with a maturity of 15 years. The revised project cost was estimated at US$1.3 billion and was financed on a debt to equity ratio of 70:30. Bank Central Asia (BCA) providing a US$332 million load and Bank DKI were the mandated lead arrangers and book runners for the loans. The other banking and financial institutions involved in the syndicated loan are Bank Artha Graha, Bank CIMB, Niaga, Deutsche bank Indonesia, the Export Import Bank of Malaysia Berhad (MEXIM) US$95 million, Bank ICBC Indonesia,Indonesia Infrastructure Finance, Bank International Indonesia, Bank Panin and Sarana Multi Infrastruktur. Another 11 banks are regional development banks (BPD), comprising BPD Jambi, BPD Jawa Barat and Banten,BPD Jawa Tengah, BPD Jawa Timur, BPD Kalimantan Barat, BPD Kalimantan Selatan, BPD Kalimantan Tengah, BPD Kalimantan Timur, BPD Maluku, BPD Papua and BPD Sumatera Barat. Hidden until construction starts to ensure that the borrower (the project company) can draw down loans from the lender. Projects needs updates regarding the "first" financial close. It had an original financial closure date of 2007 and was hidden until 2012.