Indonesia's Apexindo cancels sukuk bond issue

JAKARTA, June 5 (Reuters) - Indonesian drilling firm PT Apexindo Pratama Duta Tbk APEX.JK cancelled plans to raise 250 billion rupiah ($25 million) from an Islamic-compliant bond issue, an official at the firm said on Friday.

The firm had planned to raise 500 billion rupiah from the sale of conventional bonds and a further 250 billion rupiah from an ijarah sale-and-leaseback sukuk, with the proceeds intended for working capital.

"It is cancelled," corporate secretary Ade R Satari told Reuters, referring to the sukuk issuance, but declined to give further details.

Apexindo said on its website late on Thursday that it planned to increase the size of the conventional bond issue to 600 billion rupiah, split into three-year and five-year tranches with coupons of 13.9 percent and 15 percent, respectively.

PT Mandiri Sekuritas, PT DBS Vickers Securities Indonesia, PT CIMB Niaga, PT Indo Premier Securities, and PT Optima Kharya Capital Securities have been appointed to underwrite the bonds.

Islamic bonds are structured as profit-sharing or rental agreements, and their returns are derived from underlying physical assets such as real estate or commodities. ($1 = 10,025 rupiah) (Reporting by Sonya Angraini; Editing by Sara Webb)