PT Bakrie & Brothers Tbk. (“BNBR” or the “Company”) obtained approval from shareholders to convert part of the Company’s debt to its creditors by issuing new shares through the Capital Increase without Pre-emptive Rights (PMTHMETD) mechanism or private placement. This approval was obtained at the Company’s Extraordinary General Meeting of Shareholders (EGMS), in Jakarta, Thursday (28/11/2024).

“Alhamdulillah, the conversion of debt into new shares will improve the Company’s financial position. “So the Company will have a healthier debt ratio, reduced financial burden, and stronger cash flow,” said Deputy President Director of BNBR, A. Ardiansyah Bakrie, after the EGMS.

Ardi said that the new shares to be issued were 13.35 billion Series E ordinary shares, equivalent to 7.70% of the issued and fully paid-up capital of the Company, with an exercise price of IDR 64 per share. The private placement was carried out to convert the Company’s debt to Eurofa Capital Investment Inc (Eurofa) and Silvery Moon Investment Ltd (SMIL), with a maximum value of IDR 855 billion.

BNBR Finance Director Roy Hendrajanto M. Sakti added that the Company’s debt to Eurofa worth USD 50 million or Rp. 750 billion, will be converted into new shares totaling 11.71 billion shares.

Meanwhile, it was agreed that the Company’s debt to SMIL would be converted into new shares with a value of IDR 105 billion or a maximum of 1.64 billion shares through a private placement scheme. This value represents the remainder of the Company’s initial debt to SMIL amounting to IDR 465.11 billion, which the Company has settled for IDR 360.10 billion by the maturity date of September 30 2024.

“With the approval of the issuance of these new shares, the Company’s debt to Eurofa and SMIL will be converted into issued and fully paid capital and all of the Company’s debt to Eurofa and SMIL will be paid off,” explained Roy.

According to Roy, after this action, the Company’s total liabilities will decrease by IDR 855 billion. So, based on the financial position report as of June 30 2024, the Company’s total liabilities have decreased from IDR 4.48 trillion to IDR 3.62 trillion. Apart from that, equity also increased from IDR 2.78 trillion to IDR 3.64 trillion.

With this increase in equity, said Roy, the ratio of total current assets to total short-term liabilities will increase from the previous 102.17% to 130.28%. Meanwhile, the Company’s liabilities to equity ratio will decrease from the previous 1.61x to 1.00x.

“The ratio of liabilities to total assets of the Company will also decrease from the previous 0.62x to 0.50x,” said Roy.

Successfully Complete the Debt Restructuring Process

Roy explained that this corporate action in the form of a private placement is the final stage in a series of completion of the Company’s debt restructuring process which has been carried out since 2016. After several years of ongoing restructuring process, followed by the Quasi Reorganization corporate action which became effective on August 22 2024, the Company has written off the balance. deficit of IDR 19.5 trillion as of 31 December 2023 turned positive. Retained Earnings Balance of IDR 636.2 billion as of 30 September 2024.

Positive Performance

The Company’s performance in the first 9 months of 2024 experienced a significant increase in net profit of 383% from IDR 134.2 billion in 2023 to IDR 649.2 billion in 2024. With the success of the Company in implementing the Quasi Reorganization and completing this debt restructuring, the Company’s balance sheet posture has improved significantly. slimmer and healthier after this private placement.

“The series of corporate actions carried out so far have been seen to produce positive results. It can be seen that the Company’s balance sheet has a very good liability and equity structure. “Furthermore, BNBR will focus on strengthening the operational side of the business in all sectors in the Company’s business units, including developing new businesses in various strategic projects that have good prospects,” said Roy.