Bumi Serpong Damai to Sell Land for $208 Million to Joint Ventures

By : webadmin | on 12:22 PM January 22, 2013
Category : Archive

Property developer Bumi Serpong Damai, a part of the Sinar Mas Group, plans to sell 75 to 95 hectares of land worth Rp 2 trillion ($208 million) to a swag of joint ventures.

The first joint venture is a collaboration between Hong Kong Land, a property arm of Jardine Matheson Holdings, and BSD. The joint venture will buy 65 to 85 hectares of land in BSD City, a satellite town in Banten, worth Rp 1.3 trillion to Rp 1.4 trillion.

The name of the joint venture has not been decided but BSD will own a 51 percent stake in it.

BSD and its partners plan to develop for premium customers property projects that consist of houses, apartments and commercial buildings.

“We will utilize internal cash to finance the project. The construction is expected to begin in the second half of this year,” Hermawan Wijaya, a director at BSD, said last week.

The second joint venture will be established through a partnership with another foreign company.

This venture will buy 10 hectares of land worth Rp 600 billion. BSD will own 33 percent of the venture, which intends to build a mall on the site.

Hermawan said he expected the land sales to boost marketing sales by 20 percent. Funds from the land sales will be used to help finance the company’s capital expenditure for this year, which is set at Rp 2.5 trillion to Rp 3 trillion.

This year, he said, the company does not have plans to sell bonds to help finance its capex given the volatility in financial markets.

BSD has secured approval from regulators to sell up to Rp 3 trillion worth of bonds in multiple tranches. Last year, it sold Rp 1 trillion worth of bonds, as part of the bigger bond sales target.

BSD is targeting its revenue to rise 20 percent, reaching Rp 4.2 trillion to Rp 4.4 trillion this year. Last year, revenue was estimated at Rp 3.5 trillion to Rp 3.7 trillion.

Executives at BSD said that BSD City was expected to remain the main engine for the company’s revenue. Revenue from BSD City is expected to be 73 percent of the projected revenue this year.

Bumi Serpong’s shares rose 2.3 percent to Rp 1,320 on the Indonesia Stock Exchange on Monday.


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