Bapepam probes Indofarma, shares suspended<\/p>\n
The Jakarta Post, Jakarta<\/p>\n
The Capital Market Supervisory Agency (Bapepam) summoned on
\nTuesday the management of pharmaceutical company PT Indofarma for
\nalleged irregularities in its 2002 financial report.<\/p>\n
Bapepam declined to disclose the results of its meeting with
\nIndofarma, with one official saying that the meeting was only
\nmeant to seek an initial explanation from the publicly listed
\nstate-owned pharmaceutical company.<\/p>\n
The official said that Bapepam could not yet take action as
\nIndofarma's financial report was still being audited by Deloitte
\nTouche Tohmatsu.<\/p>\n
Indofarma reported to the Jakarta Stock Exchange a net loss of
\nRp 20 billion (US$2.3 million) for the year 2002. That
\ndisclosure stunned analysts and investors as the company had
\npreviously reported a net profit of Rp 88.6 billion through the
\nthird quarter of 2002.<\/p>\n
The discrepancy triggered suspicions, and analysts said it was
\nunbelievable that the company could book such a large loss in
\njust three months.<\/p>\n
Reports of the alleged irregularities prompted the Jakarta
\nStock Exchange to suspend trading in shares of Indofarma early on
\nTuesday. The management of the stock exchange said that the news
\nreports had affected trading of the shares.<\/p>\n
The Jakarta Stock Exchange urged the Indofarma management to
\nimmediately hold a press conference to clear up the issue.<\/p>\n
Indofarma is part of the government list of state-owned
\ncompanies to be sold to investors this year in a bid to raise
\ncash to help finance the 2003 state budget deficit.<\/p>\n
The sale of Indofarma was supposed to be completed last year,
\nbut due to various issues, including an unfavorable market
\ncondition, the government postponed the privatization program.<\/p>\n
But the news report of irregularities in the financial report
\nmay become another hurdle for the sale of the Indofarma stake.<\/p>\n
Indofarma's stock price was trading at Rp 230 per share when
\nthe stock exchange management suspended the shares. This price
\nwas unchanged from the closing price on Monday.<\/p>",
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"sponsor": "Okusi Associates",
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