Govt to sell remaining Gresik stake to Cemex<\/p>\n
JAKARTA (JP): The government announced on Monday that it
\nplanned to divest its remaining 51 percent stake in publicly
\nlisted cement producer PT Semen Gresik to the Mexican-based PT
\nCemex Indonesia, a move that will net the government US$520
\nmillion.<\/p>\n
State Minister of State Enterprises Laksamana Sukardi said
\npressure to raise revenue for the state budget required the
\ngovernment to push ahead with the sale of Semen Gresik.<\/p>\n
"Semen Gresik's put option (deal) is one of the sources we
\nwill also use (to finance the budget)," Laksamana said during a
\npress meeting that followed the signing of a new Letter of Intent
\n(LoI) with the International Monetary Fund (IMF).<\/p>\n
Under a put option agreement with Cemex, the government has
\nthe right to sell off its entire stake in Semen Gresik to Cemex
\nfor $520 million.<\/p>\n
"It (the put option deal) will expire on Oct. 26 and we will
\nhave to give them (Cemex) 30 days prior notice so that they can
\nprepare," Laksamana said.<\/p>\n
In 1998, Cemex purchased a 14 percent stake in Semen Gresik,
\nlured by the government's promise to allow it to become a
\nmajority shareholder in the state company.<\/p>\n
Cemex then purchased another 11 percent through the stock
\nmarket, raising its ownership to 25 percent.<\/p>\n
Semen Gresik owns two subsidiaries, PT Semen Padang and PT
\nSemen Tonasa, which were merged into the Semen Gresik Group in
\n1995.<\/p>\n
Together, they have an annual production capacity of 18.2
\nmillion metric tons of cement, as compared to the country's total
\noutput of 45 million tons.<\/p>\n
Cemex's efforts to control Semen Gresik faltered after
\nprotests against foreign ownership in Semen Padang from Padang
\npeople in West Sumatra.<\/p>\n
Claiming that Semen Padang was built on their ancestors' land,
\nthe Padang people demanded the company be separated from Semen
\nGresik.<\/p>\n
The government already showed signs of ignoring the put option
\ndeal, saying it was studying ways of compensating Cemex for the
\nloss of Semen Padang.<\/p>\n
The results of the study had never been made public.<\/p>\n
"We'll turn our attention to resolving the internal problems
\nthat exist between Semen Padang and Cemex," Laksamana said
\nwithout elaborating.<\/p>\n
The government has targeted raising some Rp 6.5 trillion
\n(about US$743.70 million) through the privatization of state
\nfirms this year.<\/p>\n
With only four months remaining, and proceeds amounting to
\nzero thus far, it has few options left to catch up on the target.<\/p>\n
"This is about the interests of the nation ... I hope that
\nthey (the people of Padang) can understand that," Laksamana said.<\/p>\n
A similar demand has also been aired by people in South
\nSulawesi, who wanted the government to spin-off Semen Tonasa from
\nSemen Gresik.<\/p>\n
South Sulawesi people, however, have taken a milder stance
\nagainst foreign investors, saying that they would welcome Cemex
\ninvesting in Semen Tonasa, but it must first be excluded from
\nSemen Gresik. (bkm)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/govt-to-sell-remaining-gresik-stake-to-cemex-1447893297",
"image": ""
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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