Indonesia's Ciliandra Perkasa calls all $140.8 million of 10¾% bonds

By Jennifer Chiou

New York, May 5 - Ciliandra Perkasa Finance Co. Pte. Ltd. announced the redemption of its remaining $140.8 million of 10¾% bonds due 2011.

According to a news release, the coupon payments have been subject to a 20% withholding tax rate instead of the previous 10%, which was the rate in effect since the issue date, as a result of tax-event regulations relating to the bonds with effect from Jan. 1.

PT Ciliandra Perkasa and its subsidiaries are expected to incur additional tax expenses of $2.1 million per year as a result of this tax event.

The company said it is redeeming the bonds because it has "explored all reasonable measures available but is not able to avoid the obligations arising from the regulations."

The company originally issued $160 million of the bonds.

Ciliandra Perkasa Finance is a Singapore-based subsidiary of PT Ciliandra Perkasa, a palm oil production company with headquarters in Jakarta, Indonesia.

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