Garuda unit set for Indonesia’s biggest share sale in a year

Bloomberg

PT Garuda Maintenance Facility AeroAsia, a unit of national carrier PT Garuda Indonesia, plans to raise as much as $300 million in an initial share sale to fund setting up of a new unit in an island near Singapore and expand overseas.
GMF AeroAsia, which conducts maintenance, repair and overhaul of aircraft for 170 customers, will offer between 20 percent and 30 percent of its equity to investors and is targeting an October listing on the Indonesia Stock Exchange, said President Director Iwan Joeniarto. It will be the biggest initial share sale in Southeast Asia’s largest economy since PT Waskita Beton Precast raised $402 million in September, according to data compiled by Bloomberg.
The company, spun off as an independent unit from Garuda in 2002, plans to use the proceeds from the share sale to set up a new facility in Batam island, south of Singapore, and to seek partners for its expansion in Dubai, Australia and East Asia, Joeniarto said. PT Mandiri Sekuritas has been appointed as the lead underwriter for the offering while PT Bahana Sekuritas, PT BNI Securities and PT Danareksa will act as the co-underwriters.
“Our aim is to grow this company at the pace of 20 to 21 percent over the next five years.” Joeniarto said. “Right now 65 percent of our revenue comes from Garuda and the rest from other airlines. In five years that ratio will be reversed.”
Indonesia is an aviation market with one of the world’s worst safety records but had its air-safety rating upgraded by the US Federal Aviation Administration last year, boosting efforts of Garuda, PT Lion Mentari Airlines and other carriers to expand services in the world’s fourth-most populous country.
GMF AeroAsia’s revenue may rise to $424.8 million this year from $388.7 million in 2016, he said.