PT Dirgantara targets private loans worth $100m to boost expansion

State enterprise PT Dirgantara Indonesia (PTDI) is set to secure more than USD100 million in a bridge loan from local banks to boost expansion and industrial efficiency.

The aerospace company has endured financial losses for more than a decade and said on 8 August that the IDR1 trillion (USD105 million) short-term loan deal agreed with a consortium of state-run banks was necessary because access to government funding was not yet available.

The bridge loan will be provided by Bank Mandiri, the Indonesian State Bank, the People's Bank of Indonesia and the Indonesia Eximbank. Funds will be made available to PTDI in the third quarter of 2012, but are scheduled to be paid off on receipt of government funding, said the company.

PTDI, based in Bandung in West Java, said in July that it expected to obtain IDR2.06 trillion in funding from the government, although it is not clear when the money will be available.

PTDI has said that both the bridge loan and the pending government funds will be used by the company to purchase modern manufacturing equipment in order to increase production capacity and complete on schedule a range of production orders.