SINGAPORE, April 10 (Reuters) - Singapore-listed United Fiber System (Unifiber) (UFSL.SI: Quote, Profile, Research) plans to raise about $225 million for expansion by selling convertible bonds and shares in its Indonesian unit, a source close to the deal said on Thursday.
The source, speaking to Reuters on condition of anonymity, said the funds raised would cover 25 percent of the cost of building a pulp mill in Indonesia.
The source did not give details on the convertible bonds issue and share sale.
Unifiber, which does construction and forestry, said in February it had entered into an agreement with China MCC20 Construction (MCC20), a unit of state-owned investment firm China Metallurgical Group Corp, to build a $863 million pulp mill in Indonesia.
But the cost of the mill has increased to $900 million, due to the euro's appreciation against the U.S. dollar, as most of the equipment was purchased from Europe, the source said.
Unifiber would obtain the remaining $675 million from MCC20 in the form of a cash loan to be repaid over 10 years, the source added.
The proposed bleached hardwood kraft pulp mill in South Kalimantan has a production capacity of 600,000 air dry tonnes per year, the company said. (Editing by Jennifer Tan)
Showing posts with label Unifiber. Show all posts
Showing posts with label Unifiber. Show all posts
Friday, April 11, 2008
Tuesday, April 8, 2008
United Fiber surges as stalled mill gets going
New Chinese partner set to sign turnkey contract for pulp mill
SHARES in United Fiber System surged as much as 15 per cent in trading yesterday as a long held-up billion-dollar pulp-mill project looks set to start taking shape with the expected signing this week of a turnkey contract with a new Chinese partner.
The stock of the forestry, pulp and construction company closed trading at 29.5 cents, up 13.5 per cent or 3.5 cents, after hitting an intra-day high of 30 cents. Some 153.7 million shares changed hands for the day.
Since end-February, the counter has been on an upward trajectory on the back of record order books for its wholly owned subsidiary Poh Lian Construction. The unit saw a 58 per cent surge in its order books to $550 million after winning a $202 million building contract from UOL, which was expected to contribute positively to group revenue this year.
United Fiber has also seen a substantial shareholder gradually raising its stake in the company. On Thursday last week, Lee Pineapple Co - through wholly owned subsidiary Paramount Assets Investments Pte Ltd - raised its holding to 7.14 per cent.
'I believe the Lee family will continue to buy after becoming a substantial shareholder (in March). They are not the only ones who look like they'll be increasing their stake. I suspect there will be more,' a local house trader was quoted as saying by Dow Jones Newswire yesterday.
This stake increase also came ahead of the finalisation this week of the turnkey contract to build a US$863 million (S$1.19 billion) greenfield pulp mill in South Kalimantan in Indonesia - a tie-up between United Fiber's unit PT Marga Buana Bumi Mulia and China MCC20 Construction Co Ltd.
China MCC20 will be responsible for the design, procurement and supply of all machinery and equipment, civil work, and the installation work as well as providing supplier's credit for the project.
The contract with the new Chinese partner, which was announced on Feb 24, helped allay investor concerns about the project which was long held-up over regulatory clearance by both the Indonesian and the Chinese governments.
The delay led to the earlier contract with China National Machinery & Equipment Import & Export Corp being aborted and the new contract with China MCC20.
United Fiber and China MCC20 have targeted to execute the engineering, procurement and construction contract and the supplier's credit agreement before Friday this week.
SHARES in United Fiber System surged as much as 15 per cent in trading yesterday as a long held-up billion-dollar pulp-mill project looks set to start taking shape with the expected signing this week of a turnkey contract with a new Chinese partner.
The stock of the forestry, pulp and construction company closed trading at 29.5 cents, up 13.5 per cent or 3.5 cents, after hitting an intra-day high of 30 cents. Some 153.7 million shares changed hands for the day.
Since end-February, the counter has been on an upward trajectory on the back of record order books for its wholly owned subsidiary Poh Lian Construction. The unit saw a 58 per cent surge in its order books to $550 million after winning a $202 million building contract from UOL, which was expected to contribute positively to group revenue this year.
United Fiber has also seen a substantial shareholder gradually raising its stake in the company. On Thursday last week, Lee Pineapple Co - through wholly owned subsidiary Paramount Assets Investments Pte Ltd - raised its holding to 7.14 per cent.
'I believe the Lee family will continue to buy after becoming a substantial shareholder (in March). They are not the only ones who look like they'll be increasing their stake. I suspect there will be more,' a local house trader was quoted as saying by Dow Jones Newswire yesterday.
This stake increase also came ahead of the finalisation this week of the turnkey contract to build a US$863 million (S$1.19 billion) greenfield pulp mill in South Kalimantan in Indonesia - a tie-up between United Fiber's unit PT Marga Buana Bumi Mulia and China MCC20 Construction Co Ltd.
China MCC20 will be responsible for the design, procurement and supply of all machinery and equipment, civil work, and the installation work as well as providing supplier's credit for the project.
The contract with the new Chinese partner, which was announced on Feb 24, helped allay investor concerns about the project which was long held-up over regulatory clearance by both the Indonesian and the Chinese governments.
The delay led to the earlier contract with China National Machinery & Equipment Import & Export Corp being aborted and the new contract with China MCC20.
United Fiber and China MCC20 have targeted to execute the engineering, procurement and construction contract and the supplier's credit agreement before Friday this week.
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