Corporate action: WIKA finalises rights issue scheme
This article has been translated by PwC Indonesia as part of our Indonesia Infrastructure News Service. PwC Indonesia has not checked the accuracy of, and accepts no responsibility for the content.
Investor Daily - Aksi korporasi: WIKA matangkan skema rights issue
8 December 2023
by: Dionisio Damara
Jakarta - PT Wijaya Karya (Persero) Tbk (WIKA) will conduct a rights issue as a scheme to receive a state equity participation (PMN) worth Rp6 trillion in 2024.
In their prospectus, WIKA’s management stated that, based on the 2024 draft state budget (RAPBN), the company was approved to receive a PMN worth Rp6 trillion that is set to be disbursed no later than the first quarter of 2024.
“Hence, the company is planning to carry out a PMHMETD (capital increase with pre-emptive rights),” WIKA’s management wrote in their prospectus that was released at the Indonesia Stock Exchange (IDX) on Wednesday (6/12).
In the PMHMETD, WIKA is planning to issue 92.23 billion Series B shares worth Rp100 per share.
WIKA’s management said that the PMHMETD would be cash-based with the number of shares issued aligning with WIKA’s required funds.
WIKA will also hold an extraordinary general shareholders’ meeting (RUPSLB) on 12 January 2024 in Jakarta. Official summons for the meeting will be issued on 21 December 2023.
The construction SOE (state-owned enterprise) issuer’s management explained that the purpose of the corporate action was in line with WIKA’s restructuring effort that will be carried out by implementing several financial recovery streams.
The restructuring method will be implemented through eight streams, namely financial restructuring, governance and risk management improvements, receivable disbursement acceleration, and business model-based asset recycling.
Besides that, WIKA will also focus on enhancing their orderbook portfolio, optimising operating costs to be more efficient, reducing their supply chain financing balance, and strengthening their capital restructure in accordance with the decisions made at the RUPSLB held on 13 October.
On the other hand, WIKA has also been assigned to complete national strategic projects and Nusantara Capital City (IKN). The scope of work includes constructing toll roads, providing drinking water provision systems, and building dams, power plants, and smelters.
WIKA predicts that the new contract value that will be obtained by the company in 2024 will reach around Rp25 trillion to Rp27 trillion. The amount is similar to their contract value projection for 2023.
“To realise the strategic projects, the company needs additional funding to strengthen their capital structure. One of the solutions is a PMHMETD,” WIKA’s management wrote.
Restructuring progress
In another update, three out of four WIKA bondholders' general meetings (RUPOs) have approved the company's request to waive obligation fulfilments.
However, the RUPO on Wijaya Karya Continuous Bonds II Phase 1 Year 2021 rejected WIKA's proposal for a waiver.
Quoted from the information exposure made on Thursday (7/12), WIKA’s management said that the bondholders voted to reject the proposal.
WIKA Corporate Secretary Mahendra Vijaya explained that, similar with RUPOs of other companies, certain proposals presented at these meetings did not garner approval from the bondholders.
Hence, the company is planning to hold another RUPO. Mahendra stated that WIKA is continuously receiving aspirations from all stakeholders to prioritise good corporate governance principles and excellent risk management.
“The company hopes that all stakeholders will provide support so that the recovery can progress as planned and support the company’s business activities continuously,” Mahendra said when he was contacted by Bisnis on Thursday (7/12).
