Medco Energi Signs Intercompany Credit Agreement Worth US$ 373.6 Million

TEMPO.CO, Jakarta - PT Medco Energi Internasional Tbk (MECD) has officially signed an intercompany credit agreement with Medco Cypress Tree Pte. Ltd. worth US$ 373.6 million or around Rp 6.07 trillion. This affiliate transaction took place on June 10, 2025.

Medco's Corporate Secretary, Siendy K. Wisandana, stated that this loan will be used to pay off the tender offer of two senior notes amounting to US$ 650 million with an interest of 7.375 percent due in 2026 and US$ 650 million with an interest of 6.375 due in 2027. "Issued by Medco Oak Tree Pte Ltd and Medo Bell Pte Ltd," she said in the information disclosure to the Indonesia Stock Exchange on Sunday, June 15, 2025.

Siendy stated that this transaction will not have any impact on operational, legal, or business continuity activities. She said that this event is an affiliate transaction based on Article 6 paragraph 1 letter b of the Financial Services Authority Regulation. This rule stipulates that Medco is only required to report to the Financial Services Authority because it is carried out by MCT and MEG, which are indirectly owned 100 percent by the company.

Last May, MEDC also carried out a corporate action by injecting Rp 33 billion in capital into its subsidiary, PT Satria Raksa Buminusa (SRB). The loan to the security and consulting services company will be valid until July 31, 2027, without interest. "The Company acts as the lender and SRB as the borrower," said Medco's Corporate Secretary Siendy K. Wisandana in the information disclosure to the Indonesia Stock Exchange, Wednesday, May 14, 2025.

Prior to this, Medco Energi has also issued senior bonds worth US$ 400 million, 144A/Reg S, with a tenor of five years. MedcoEnergi's CEO, Roberto Lorato, said that the support from global investors reflects confidence in the company's performance and consistency in fulfilling operational and financial commitments.

"Amid the challenges of the current global market dynamics, investors appreciate the company's disciplined approach to capital management, cost control, growth initiatives, and proactive liability management," he said in an official statement quoted on Saturday, May 10, 2025.

Roberto stated that the company's solid financial position is reflected in the credit ratings obtained by Medco Energi, such as B1 (positive outlook) from Moody's, as well as BB- (stable outlook) from S&P and Fitch. The proceeds from the issuance of these bonds will be used to fund the repurchase of the company's senior bonds that will mature in 2026 and 2027.

According to Roberto, the issuance of US$ 400 million in bonds will also extend the company's debt maturity profile until 2030. In addition, it is also considered to strengthen the company's strategic commitment to the 144A/Reg S dollar financing market as the main source of funding.

Editor's Choice: Medco Energi to Buy Back Shares Worth US$50 Million

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