Consultants to help restructure state firms<\/p>\n
JAKARTA (JP): The government has named six foreign consultants
\nto assist in the consolidation of the 159 state-owned companies
\ninto 10 holding companies, a senior government official said on
\nThursday.<\/p>\n
Sofyan Djalil, an assistant to the State Minister of the
\nEmpowerment of State Enterprises, said the government hired
\nMcKenzie & Co., PriceWaterhouseCoopers, Boston Consulting Group,
\nA.T. Kerney, Booz Allen & Hamilton Inc. and Ernst & Young.<\/p>\n
\"They will help us in analyzing the pluses and minuses of the
\nholding companies,\" he told The Jakarta Post on the sidelines of
\na seminar.<\/p>\n
Sofyan said that McKenzie would handle consolidation for the
\nagroindustry sector, A.T. Kerney for strategic industries,
\nPriceWaterhouseCoopers for the mining sector and Ernst & Young
\nfor forestry, paper and wood product industries.<\/p>\n
He did not specify the assignments of Boston Consulting Group
\nand Booz Allen & Hamilton.<\/p>\n
They were selected from nine overseas consultants which
\nparticipated in the bid.<\/p>\n
State Minister of the Empowerment of State Enterprises Tanri
\nAbeng has set a September target for the consolidation of the
\nstate firms into 10 holding companies.<\/p>\n
Tanri argues the consolidation will boost the value of the
\ncompanies, enhancing the government's chance of raising a larger
\namount of revenue from privatization.<\/p>\n
Sofyan said the revenue from the privatization would help the
\ngovernment repay its foreign debt, currently estimated at about
\nUS$70 billion.<\/p>\n
He dismissed concern that the plan to establish the holding
\ncompanies would disrupt the current privatization program.<\/p>\n
Tanri's office has targeted raising about Rp 13 trillion from
\nprivatization proceeds to help finance the 1999\/2000 state
\nbudget.<\/p>\n
Sofyan said that at the current exchange rate of about Rp
\n6,700 to the U.S. dollar, the target would be about $2 billion.<\/p>\n
The government has raised $806 million in privatization
\nproceeds so far, he added.<\/p>\n
Sofyan was optimistic the rest of the target could be met.<\/p>\n
He said the government would proceed with the privatization of
\nplantation firms PT Perkebunan IV and PT Perkebunan III,
\ninternational telecommunications firm PT Indosat and airport
\nmanagement firm PT Angkasa Pura II, which manages the Soekarno-
\nHatta International Airport.<\/p>\n
He added that initial bids for Angkasa Pura II by two foreign
\nairport management firms, one from France and the other a
\nconsortium of Schipol in the Netherlands and the British Airport
\nAuthority, were turned down.<\/p>\n
\"Their first bids were lower than our expectations, so we
\nasked them to repeat the bids,\" Sofyan said. (rei)<\/p>",
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