DUE DILIGENCE Q&A PACK

Pengembangan kawasan industri yang terencana dan efisien.

PROJECT OVERVIEW

Q1. What is the nature of the project?

• The Project is the development of a ±3,000-hectare integrated industrial estate in Katibung District, South Lampung, Indonesia, designed as a multi-sector industrial hub with phased development.

Q2. Why is Katibung strategically located?

• A:Katibung is positioned along the Trans-Sumatra corridor with direct connectivity to ports, national roads, and future logistics infrastructure, offering competitive land cost and access to Sumatra and export markets.

Q3. Is the project aligned with national policy?

A : Yes. The Project is aligned with:

• RDTR (Detailed Spatial Plan)

• RPJMN & RPJMD Lampung

• PSN (National Strategic Project) framework

• KPBU (PPP) investment scheme

B. LAND & LEGAL STATUS

Q4. What is the legal status of the land?

• Approximately 90% of the land is privately owned (Hak Milik) and targeted for acquisition/conversion, while 10% consists of public/government facilities, to be addressed via coordination with relevant authorities.

Q5. Are there any land disputes?

A : Based on preliminary assessment, no material disputes have been identified. Formal legal due diligence will confirm title, encumbrances, and boundary status prior to financial close.

Q6. Can foreign investors own land?

A : Foreign investors participate through shareholding in an Indonesian SPV. The land is held by the SPV in compliance with Indonesian law.

C. REGULATORY & PERMITS

Q7. Is zoning secured?

• The Project is included in RDTR and designated for industrial use, subject to final permitting and compliance with environmental approvals.

Q8. What permits are required?

A : Key permits include:

• Location Permit

• Environmental Approval (AMDAL)

• Business Licensing via OSS

• Industrial Estate License

Q9. Is there government support?

• Yes. Government support is provided under the KPBU framework, including facilitation of licensing, zoning certainty, and infrastructure connectivity.

E. FINANCIAL & RETURNS

Q13. What is the total project cost?

A : Indicatively IDR 20–22 trillion, deployed in phases.

Q14. What returns are expected?

• Project IRR (unlevered): ~15–18%

• Equity IRR (levered): 18–22%+

Q15. What drives value creation?

• Low land acquisition cost

• Industrial zoning uplift

• Infrastructure-led appreciation

• Phased monetization and anchor tenants

F. RISK & MITIGATION

Q16. What are the key risks?

• Land acquisition risk

• Regulatory risk

• Market absorption risk

• FX risk

Q17. How are risks mitigated?

• Phased land acquisition

• KPBU framework & government alignment

• Anchor tenant strategy

• USD-linked leases and natural FX hedging

Q18. Is political risk addressed?

• Yes. Through government participation, regulatory alignment, and availability of political risk insurance (e.g., MIGA).

G. ENVIRONMENTAL & SOCIAL

Q19. Is the project ESG compliant?

• The Project will comply with Indonesian environmental laws and is structured to align with international ESG and sustainability standards.

Q20. Is AMDAL required?

• Yes. AMDAL is required and will be completed prior to full-scale development.

H. TAX & REPATRIATION

Q21. Can profits be repatriated?

• Yes. Dividends can be repatriated in accordance with Indonesian law and applicable tax treaties.

Q22. Is tax optimization possible?

• Yes, via treaty jurisdictions and compliant tax structuring.

D. STRUCTURE & GOVERNANCE

Q10. What is the investment structure?

• A two-tier structure comprising an offshore holding company and an Indonesian operating SPV under a JV–KPBU framework.

Q11. What level of control does the foreign investor have?

A : While foreign ownership is capped at 49%, control is ensured through:

• Board representation

• Reserved matters

• Supermajority voting rights

• Shareholders Agreement protections

Q12. Who manages day-to-day operations?

• The SPV management team, appointed by the Board, is responsible for operations, subject to strategic oversight by shareholders.