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Hiswara Bunjamin & Tandjung advises the initial purchasers in Indonesia’s Star Energy Geothermal’s dual tranche US$1.11 billion green project bond

23 October 2020 | Indonesia
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Herbert Smith Freehills’s Indonesian associate firm Hiswara Bunjamin & Tandjung (HBT) has advised Barclays, Credit Suisse, DBS and Deutsche Bank as initial purchasers in Star Energy Geothermal Group’s issue of US$1.11 billion new senior secured green project bonds.

This is the first Indonesian green corporate bond with an investment-grade rating and the second green bond issue by Star Energy Geothermal, Indonesia’s largest geothermal energy producer. 

The new senior secured green bonds are split across two tranches. The US$320 million 3.25% tranche has a term of 8.5 years (due in April 2029) while the US$790 million 4.85% tranche has a term of 18 years (due in October 2038). Both tranches are listed on the Singapore Exchange.

“With this issue, Indonesia now leads ASEAN in green bond issuance this year, marking the country’s rapid shift to sustainable projects,” said HBT partner Tjahjadi Bunjamin, who led the team advising the initial purchasers.

“The bonds were also heavily oversubscribed, reflecting strong interest in this sector from both local and international investors.”

Indonesia’s shift to green financing began with the country’s green Islamic bond issue (sukuk) in February 2018 – also the first Asian sovereign green bond. Industry followed suit, with the country‘s first corporate green bond issued in July 2018.

Tjahjadi was assisted by, among others, senior associate Aditya Rachman and associate Defina Rosa Tantri.

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