Lippo Village, Tangerang, Indonesia
Wednesday, 28 November 2018.
In response to recent news coverage, PT Lippo Karawaci Tbk ("LPKR") wishes to share a number of clarifications related to:
1. With regard to LPKR's liquidity and business model
LPKR has successfully delivered on its asset divestment plan with the completion of the sale of First REIT Manager and a partial sale of its First REIT shares generating IDR 2.2 trillion in proceeds. Together with the upcoming imminent asset divestments, the Company will raise in excess of IDR 6 trillion in net cash.
This will allow LPKR to further strengthen its liquidity position allowing it to meet with certainty all debt repayments including the US$75 million unsecured bonds due in June 2020; as such, the next maturity event for LPKR would not be until 2022.
At the right time, we also still have the option to consider the possibility of exploring various corporate actions to raise equity into the LPKR.
More important than the strength of liquidity and balance sheet is that LPKR remains to be the most dynamic and leading property development platform in Indonesia. LPKR has developed major enterprises with leading market shares in the following sectors:
We believe the above reflects LPKR unique track record in creating value, and its ability to conceptualize, innovate, execute, and monetize opportunities. This has and will continue to be the hallmark of our business.
2. With regard to questions related to various other Lippo companies acquiring assets from Lippo Karawaci in the context of our asset divestment plan:
LPKR, as are other Lippo companies, is each managed on an independent and stand-alone basis, and upholds the highest standards of corporate governance. LPKR's asset divestment program is carried out in the context of maximizing stakeholder value. To the extent that these transactions involve other affiliated companies, it is done so in the best interest of both companies' stakeholder, and having met all the proper regulatory and legal requirements necessary in such related party transactions.
The First REIT transaction, for example, allowed LPKR an opportunity to further strengthen its liquidity position and crystalize value in a business that it had built, and at the same time allowing the buyer an opportunity to acquire one of the largest healthcare REIT platforms in Singapore at what we believe is an attractive valuation.
About Lippo Karawaci ("LPKR") (www.lippokarawaci.co.id)
LPKR is Indonesia's largest listed property company by total assets and revenues, anchored by a large land bank and solid recurring income base. LPKR's businesses comprise Residential/Townships, Retail Malls, Hospitals, Hotels and Asset Management. LPKR develops residential, light industrial, commercial, retail properties throughout Indonesia. LPKR through its subsidiaries manage and operate hospitals, malls and hotels in major cities in Indonesia and also provides a broad range of infrastructure services to the residents of our developments, and other property management and REIT management services.
Through our two main publicly listed subsidiaries, PT Lippo Cikarang, Tbk ("LPCK") and PT Gowa Makassar Tourism Development Tbk ("GMTD"), of which LPKR owns 54.4% and 62.7% respectively, LPKR develops and currently operates urban developments at Lippo Cikarang in Bekasi and at Tanjung Bunga in Makassar. In addition, LPKR owns 51.05% of PT Siloam International Hospitals Tbk ("SILO"), the largest private hospitals network in Indonesia, which currently manages and operates 34 state-of-the-art-hospitals in 25 cities throughout the country, comprising 12 hospitals in Greater Jakarta and 22 hospitals distributed across Java, Sumatra, Kalimantan, Sulawesi, Bali and Nusa Tenggara supported by more than 2,700 specialists and general practitioners as well as over 10,000 nurses and support staff.
LPKR has established and sponsored two public listed REIT in Singapore, namely First Real Estate Investment Trust ("First REIT") and Lippo Malls Indonesia Retail Trust ("LMIR Trust"). LPKR is listed on the Indonesian Stock Exchange with market capitalization of IDR 6.3 trillion or USD 433 million as at 27 November 2018.
For more information please contact:
William Wijaya Utama
Danang Kemayan Jati
Vice President, Head of Corporate Communication
This press release has been prepared by PT Lippo Karawaci Tbk ("LPKR") and is circulated for the purpose of general information only. It is not intended for any specific person or purpose and does not constitute a recommendation regarding the securities of LPKR. No warranty (expressed or implied) is made to the accuracy or completeness of the information. All opinions and estimations included in this release constitute our judgment as of this date and are subject to change without prior notice. LPKR disclaims any responsibility or liability whatsoever arising which may be brought against or suffered by any person as a result of reliance upon the whole or any part of the contents of this press release and neither LPKR nor any of its affiliated companies and their respective employees and agents accepts liability for any errors, omissions, negligent or 3 otherwise, in this press release and any inaccuracy herein or omission here from which might otherwise arise.
Certain statements in this release are or may be forward- looking statements. These statements typically contain words such as "will", "expects" and "anticipates" and words of similar import. By their nature, forward looking statements involve a number of risks and uncertainties that could cause actual events or results to differ materially from those described in this release. Factors that could cause actual results to differ include, but are not limited to, economic, social and political conditions in Indonesia; the state of the property industry in Indonesia; prevailing market conditions; increases in regulatory burdens in Indonesia, including environmental regulations and compliance costs; fluctuations in foreign currency exchange rates; interest rate trends, cost of capital and capital availability; the anticipated demand and selling prices for our developments and related capital expenditures and investments; the cost of construction; availability of real estate property; competition from other companies and venues; shifts in customer demands; changes in operation expenses, including employee wages, benefits and training, governmental and public policy changes; our ability to be and remain competitive; our financial condition, business strategy as well as the plans and objectives of our management for future operations; generation of future receivables; and environmental compliance and remediation. Should one or more of these uncertainties or risks, among others, materialize, actual results may vary materially from those estimated, anticipated or projected. Specifically, but without limitation, capital costs could increase, projects could be delayed and anticipated improvements in production, capacity or performance might not be fully realized. Although we believe that the expectations of our management as reflected by such forward-looking statements are reasonable based on information currently available to us, no assurances can be given that such expectations will prove to have been correct. You should not unduly rely on such statements. In any event, these statements speak only as of the date hereof, and we undertake no obligation to update or revise any of them, whether as a result of new information, future events or otherwise.