MedcoEnergi raises $300M in 2032 bonds at 8.875% to refinance debt
What's the deal? Indonesian energy company Medco Energi Internasional (IDX: MEDC) has raised $300 million through a bond issue by its subsidiary, Medco Redwood Tree Limited. The notes carry an 8.875% coupon and mature in 2032, and the company guarantees the debt.
Why now? This is a refinancing, not new money. MedcoEnergiDealroom has a profile for this one. Try Dealroom → says net proceeds will repay existing debt, including notes due in 2028–29, extending its maturity profile.
The details: Issued under Rule 144A/Reg S offerings, the bonds earned ratings of BB- from FitchDealroom has a profile for this one. Try Dealroom → and S&P Global and Ba3 from Moody's. In rupiah terms, the deal is worth about US$353.1M.
The 8.875% coupon sits near the 8.96% on Medco's 2029 dollar bonds and above the 8.625% on its 2030 issue from 2025 — a reminder of the high cost of dollar funding for a BB-/Ba3-rated credit.
What's the endgame? MedcoEnergi operates in oil and gas, power, and copper and gold mining. First-half 2026 oil and gas output reached 170 mboepd, up 19% year on year, with gas making up about 72% of production. The company kept its 2026 guidance of 165–170 mboepd and $415 million in oil and gas capital spending.
Key quote: "This bond issuance reinforces our commitment to proactive liability management and financial discipline," said chief executive officer Ronald Gunawan. "Refinancing existing debt supports our efforts to maintain a well-managed debt maturity profile." (translated from Indonesian)
S&P said the refinancing should have little effect on debt metrics and assessed Medco as having capacity for its proposed Eni asset acquisition.
The signal: The deal extends maturities without materially raising leverage, but the near-9% coupon shows how expensive dollar debt has become for emerging-market energy issuers. For MedcoEnergi, locking in 2032 maturities buys room to fund growth while managing its liability stack.
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