Railway operator to arrange syndicated loan for Jakarta LRT

State-owned railway operator PT Kereta Api Indonesia (KAI) says it will soon establish a loan syndication for the development of the light rail transit (LRT) service in Greater Jakarta, following the disbursement of government funds for the project.

"We will soon start the process of arranging the syndicated loan so that the project will not stall," said PT KAI president director Edy Sukmoro on Wednesday, as reported by kontan.co.id, after the company had finally secured a Rp 2 trillion (US$150.2 million) state capital injection (PMN) for the LRT project.

To fund the Rp 27.5 trillion project, the railway company required an estimated Rp 9 trillion in equity from the state to allow it to access a Rp 18.5 trillion syndicated loan from banks. With the newly approved injection, it has so far obtained Rp 4 trillion in equity.

Read also: KAI obtains Rp 2T capital injection from state for LRT project

Edy said he would be talking to the representatives of several banks to ensure their participation. "We will talk about how much we need from the banks," he said.

He added he would also talk to state-owned construction company PT ADhi Karya, the developer of the LRT project, about potential funds from the Transit Oriented Development (TOD).

The LRT's construction is set in two phases. The first phase will install a 43.3-kilometer track from Bogor, West Java, to Jakarta, and includes construction of the Cibubur-Cawang, Bekasi Timur-Cawang and Cawang-Dukuh Atas sections. This initial phase is expected to be completed in 2019.

The second phase will construct a 38.5-kilometer track comprising the Cibubur-Bogor, Dukuh Atas-Palmerah-Senayan and Palmerah-Grogol routes. (bbn)

Source: Railway operator to arrange syndicated loan for Jakarta LRT