Indonesia's Berau Coal marketing $325 million five-year notes this week via Merrill Lynch

By Paul A. Harris

St. Louis, Dec. 4 - Indonesian coal producer PT Berau Coal began a European roadshow on Monday for its $325 million offering of five-year senior secured notes in two tranches (expected ratings B1/B+), according to a market source.

The company, which intends to issue the notes via its Empire Capital Resources Pte. Ltd. (Singapore) subsidiary, is offering $200 million minimum of fixed-rate notes, which will come with three years of call protection.

The deal also features a tranche of amortizing floating-rate bullet notes, with equal quarterly amortizations. The size of the amortizing notes tranche remains to be determined.

Merrill Lynch & Co. is the bookrunner for the Rule 144A and Regulation S transaction.

A U.S. roadshow will begin on Wednesday.

The notes will feature a customary incurrence based high-yield covenant package.

Proceeds will be used to refinance debt as well as to fund capital expenditures and for general corporate purposes.

The company is based in Jakarta, Indonesia.

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