👟 Walk the Talk: Danantara
Acrostics Asia has accurately mapped Danantara’s reason for existence and fundraising route even before the Indonesian sovereign fund was officially launched.
Indonesian sovereign fund Danantara is a new entity with broad remit to raise financing for President Prabowo Subianto’s projects and restructure the country’s sprawling state-owned companies.
Even before Danantara was officially launched in February 2025, Acrostics Asia has accurately mapped its reason for existence and fundraising route.
Key Timeline
Acrostics Asia wrote that Danantara was designed to pool Indonesian state-owned enterprises (SOEs) and leverage up to finance President Prabowo Subianto’s projects.
Danantara was likely created to borrow more at the corporate level without busting Indonesia’s fiscal deficit ceiling.
Acrostics Asia wrote that a revision of Indonesia’s SOE Law to set up Danantara was accelerated through the Parliament.
While the decoupling of SOE and state losses may help state-owned banks to unclog their bad loans, some investors question how the regulatory changes will affect SOE leverage and governance.
Danantara sought to make a USD 10 billion loan debut, which could be Southeast Asia’s biggest facility.
Acrostics Asia flagged that potential lenders may consider narrowing the use of proceeds or backing specific projects to get around the lack of collateral.
Even though several media reported that Danantara had clinched a USD 10 billion credit line, Acrostics Asia wrote that the banks were unlikely to underwrite such a huge unsecured loan right off the bat.
Acrostics Asia also pointed out that Danantara would likely have to syndicate the loan to a wider group of banks and build a bridge to bonds.
Acrostics Asia wrote that Danantara’s sale of low-yield “patriot bonds” to local tycoons was pitched as a form of burden-sharing, which can be traced back to former President Suharto’s era.
While Danantara controls the restructurings and consolidations of the sprawling SOEs, Acrostics Asia flagged that the fund may eventually run into a similar challenge faced by state-owned asset manager Perusahaan Pengelola Aset (PPA) to resolve the underlying bad debt.
News broke that Danantara had launched a USD 1 billion-equivalent loan into syndication, confirming Acrostics Asia’s analysis four months earlier.
Acrostics Asia noted that Danantara will likely have to construct a refinancing path to the international markets as the USD 1 billion facility will mature in three years.
Danantara’s treasury managing director Ali Setiawan reportedly said that the fund is exploring the possibility of issuing global bonds to diversify its sources of financing.
Acrostics Asia wrote that while Danantara collects dividends from Indonesian state-owned enterprises, it cannot print money or extract taxes.
The fund will likely be able to issue some offshore notes, but the question is whether bondholders would be willing to get repaid after the banks.
Full Acrostics Asia Coverage
📚 Acrostics Anatomy: Danantara’s Genesis (11 November 2024 - 25 February 2025)
📚 Acrostics Anatomy: Danantara’s Bridge to Bonds (27 June - 4 December 2025)