Herbert Smith and its associated law firm in Indonesia, Hisawara Bunjamin and Tanjung (“HBT”) have recently advised Industrial and Commercial Bank of China (Asia) Limited (“ICBC Asia”), PT Bank ICBC Indonesia (“ICBC Indonesia”) and Industrial and Commercial Bank of China (“ICBC”) on the groundbreaking RMB 2 billion offshore Sinosure-covered export financing framework arrangement provided to PT Bakrie Telecom Tbk (“Bakrie”). This transaction involves the first commercial Renminbi loan provided to a company outside of China. The proceeds of the facility will be used by Bakrie to finance the purchasing of telecoms equipment from Huawei Technology Co., Ltd.
ICBC is one of China’s ‘Big Four’ state-owned banks and the largest bank in the world by market capitalisation. ICBC Asia is a subsidiary of ICBC and a Hong Kong incorporated licensed bank. ICBC Indonesia is a subsidiary of ICBC and an exchange licensed commercial bank in Indonesia.
This transaction is the first of its kind and has received significant attention from the Chinese government. A signing ceremony was held at ICBC’s headquarters in Beijing on 12 August 2010 and was attended by high-level dignitaries from the People’s Bank of China, the Ministry of Commerce, the China Chamber of Commerce for Import & Export of Machinery and Electronic Products, ICBC, ICBC Asia, ICBC Indonesia, Huawei, Sinosure and, amongst other Herbert Smith representatives, Clive Barnard, Asia finance practice head, who attended from London and Tom Chau, head of the Herbert Smith Beijing office.
The Herbert Smith team was led by Hong Kong banking and finance partner Alexander Aitken and senior associate Kanyi Lui with support from the Beijing team, led by Tom Chau. The HBT team was led by Herbert Smith partner David Dawborn and HBT partner Tjahjadi Bunjamin, assisted by Ibnu Fajar Ramadhan and Adrianus Adritomo.
Clive Barnard commented: “We are delighted to have assisted ICBC on this landmark transaction. This is the first offshore Renminbi loan facility in history and marks an important milestone in the internationalisation of the Yuan. We are delighted that ICBC came to us for this significant transaction and we look forward to continuing to work with ICBC on further deals in the coming years.”
Tjahjadi Bunjamin commented: “This transaction demonstrates the strength of the market leading association between Herbert Smith and HBT in Jakarta. HBT and Herbert Smith have a 10 year track record of consistently providing clients with a seamless on cutting-edge complex cross-border transactions involving Indonesia. We look forward to working with ICBC and ICBC Indonesia on many exciting transactions in the future.”
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