Indonesia: State-owned drug maker Kimia Farma to raise $146m via rights issue

Visual sourced from Kimia Farma website.

Indonesia state-controlled pharmaceutical company PT Kimia Farma Tbk (KAEF) is planning to raise Rp2 trillion ($146.04 million) through a rights issue in the fourth quarter of 2016.

The company will issue new shares amounting to 1.1 billion units, or 20 per cent of its paid-up capital, at Rp1,000 apiece. The proceeds will be used to fund its expansion next year, President Director Rusdi Rosman, said.

He noted the plan is pending the approval from the government and the House of Representatives (DPR).

Rusdi said, the rights issue proceeds will be used to part-fund the company’s capital expenditure plan for next year, which is set at Rp3 trillion.

The firm is planning to develop three new plants. The company will also use its cash flows and bank loans, including from Citibank, to fund the expansion plan.

Kimia Farma will expand the capacity of its plant in Banjaran Industrial Estate, West Java to 4 billion tablets from 1.2 billion tablets per annum at present.  The company will also develop the second phase of salt plant to be used by pharmaceutical industries, which will boost the plant’s capacity to 4,000 tonne per annum, from 2,000 tonne at present.

Kimia Farma, PT Garam and PT Bio Farma also set a joint venture to produce salt to be used by pharmaceutical sector, in which Kimia Farma holds majority stake. The JV will set up a plant with production capacity of 300,000 tons per annum.

In addition, the company is also planning to build new plant to produce pharmaceutical raw materials in Cikarang, Bekasi, West Java in cooperation with a foreign partner.

Earlier, the company tied up with South Korea’s Genexine Biologics to develop a plant in Bekasi, West Java. The JV with the South Korean firm will produce generic drugs and is expected to go online in 2018. 

The company expects its revenues to rise to Rp5.5 trillion in 2016, from projected Rp5 trillion this year.  It expects net profit to increase by 14 per cent next year from estimated Rp250 billion this year.

Also Read: Indonesia’s Kimia Farma to invest $71m in new pharmaceutical plant

Thailand’s MEGA in JV with Sydna Farma to set up pharma unit in Indonesia

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In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

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  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.