BCA shares oversubscribed by 30 percent, says IBRA<\/p>\n
JAKARTA (JP): The second issue of publicly listed Bank Central
\nAsia (BCA) shares that offered 10 percent of the government's
\nstake in the bank has been oversubscribed by 30 percent, the
\nIndonesian Bank Restructuring Agency (IBRA) said on Monday.<\/p>\n
IBRA deputy chairman for bank restructuring Felia Salim said
\nthe agency was satisfied with the market reception to the July 4
\nto July 6 public offering.<\/p>\n
\"The high interest was mostly shown by local investors, but
\norders from foreign investors were also considerable,\" she said
\nin a statement.<\/p>\n
Felia said that some foreign investors who had been active in
\nthe local stock market before the 1997 economic crisis also
\nsubscribed to BCA's shares.<\/p>\n
BCA made its initial public offering in May last year, after
\nthe government nationalized what had been the country's largest
\nprivate bank.<\/p>\n
The second public offering saw the government sell 10 percent
\nof BCA's total 588.8 million shares, offered at Rp 900 (about
\n7.96 U.S. cents) a share.<\/p>\n
IBRA has said it expects to reap about Rp 500 billion from the
\npublic offering, which is part of the government's plan to unload
\na 40 percent stake in the bank to raise funds for the state
\nbudget and to fulfill the reform targets agreed to with the
\nInternational Monetary Fund (IMF).<\/p>\n
Another 30 percent stake will be sold to strategic investors
\nthrough a competitive bid that is currently underway.<\/p>\n
IBRA officials have been tightlipped over the progress of the
\ncompetitive bid, fearing it might affect talks with BCA's short-
\nlisted bidders.<\/p>\n
When IBRA failed to announce the winning bidder late last
\nmonth as originally planned, suspicion rose that the agency was
\nbeen tied up in tough negotiations with the bidders.<\/p>\n
The agency said it was extending its negotiations with the
\nbidders to strike a better deal. This statement, however, only
\nadded to suspicion that the bids received were below
\nexpectations.<\/p>\n
Extending the negotiations may prevent IBRA from reaching its
\ntarget of divesting the 40 percent equity stake in BCA by this
\nmonth.<\/p>\n
BCA's divestment, along with that of Bank Niaga, was to have
\nbeen concluded last year, as part of Indonesia's economic reform
\ntargets set out under the letter of intent signed with the IMF.<\/p>\n
The government delayed the divestments after legislators
\nopposed the move, on the grounds that a sluggish market made the
\nsales untimely.<\/p>\n
But the delay prompted the IMF to freeze its loan program to
\nIndonesia. The fund has been holding back on releasing its next
\n$400 million loan tranche since last December.<\/p>\n
A visiting IMF team is currently in Jakarta to negotiate the
\nnext letter of intent with the government, which is a
\nprerequisite for the disbursement of its loans.<\/p>\n
The team is led by the fund's Asia Pacific deputy director,
\nAnoop Singh, who has refused to comment on the progress made in
\nBCA's divestment.<\/p>\n
Singh met with IBRA officials on Monday, but declined to
\nreveal any details of their discussions. (bkm)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/bca-shares-oversubscribed-by-30-percent-says-ibra-1447893297",
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