IBRA may delay BCA share issue till March<\/p>\n
JAKARTA (JP): The Indonesian Bank Restructuring Agency (IBRA)
\nmay have to delay the crucial initial public offering (IPO) plans
\nof Bank Central Asia (BCA) until March because the agency has
\nbeen slow in registering the plans at the country's Capital
\nMarket Supervisory Agency (Bapepam).<\/p>\n
Head of IBRA's asset management and investment team Dasa
\nSutanto confirmed on Sunday that the agency had not yet
\nregistered the IPO plans.<\/p>\n
\"We'll do it first thing next week (this week),\" he told The
\nJakarta Post by phone.<\/p>\n
The BCA IPO was set for February. But according to a Bapepam
\nruling, an IPO plan must be registered at the capital market
\nwatchdog 45 days before the primary offering is made.<\/p>\n
Dasa said the February schedule was an IBRA internal target to
\npush its staff to work harder to realize the BCA IPO so that it
\ncould meet the government's target of raising some Rp 17 trillion
\n(US$2.3 billion) in cash in the current fiscal year ending on
\nMarch 31.<\/p>\n
He was confident the IPO could go through in March, while
\nsaying the BCA IPO was crucial to restoring investors' confidence
\nin the country's ailing economy.<\/p>\n
IBRA has said it plans to raise Rp 3 trillion in proceeds from
\nthe BCA IPO by selling a 30 percent stake.<\/p>\n
But Dasa said the agency could sell less than 30 percent if
\nthere was a strong market demand for the BCA offering.<\/p>\n
Asked why IBRA had been slow in making the registration at
\nBapepam, Dasa said the agency had to focus first on improving
\nBCA's credit supervision department, which had been one of the
\nbank's greatest weaknesses.<\/p>\n
He said a foreign bank had been assigned to do the job.<\/p>\n
\"We wanted to make sure everything was okay before we launched
\nthe bank on the market,\" he said.<\/p>\n
IBRA, a unit of the finance ministry, took over BCA in 1998
\nafter its owners, the Salim Group and two children of former
\npresident Soeharto, failed to repay the bank's debts to the
\ncentral bank.<\/p>\n
BCA, the country's largest private bank, has total assets of
\nsome Rp 84.4 trillion and operates some 767 branches throughout
\nthe country.<\/p>\n
IBRA has appointed Lehman Brothers, Merrill Lynch and local
\nsecurities firms PT Bahana Securities and PT Danareksa Securities
\nto manage the BCA IPO.<\/p>\n
The agency controls some Rp 600 trillion worth of various
\nbanking assets. It is mandated to sell or recover the assets to
\nraise cash to help finance the government's costly bank
\nrestructuring and recapitalization program.<\/p>\n
In the current fiscal year, IBRA must raise Rp 17 trillion to
\nhelp finance the Rp 34 trillion interest cost of the bank
\nrestructuring and recapitalization bonds issued by the
\ngovernment.<\/p>\n
IBRA is targeted to raise some Rp 16 trillion in cash in the
\ncoming fiscal year.<\/p>\n
IBRA has said it had so far raised more than Rp 10 trillion in
\ncash and is confident that it could meet the Rp 17 trillion
\ntarget.<\/p>\n
The BCA IPO and the plans to sell its 40 percent ownership in
\nthe publicly listed auto giant PT Astra International would be
\nthe major contributor to fulfilling that target.<\/p>\n
But the planned sale of Astra seemed to fall into uncertainty
\nafter IBRA was reportedly in a spat with Astra's Rini Soewandi-
\nled management team.<\/p>\n
The agency has indicated that it is proposing to dismiss
\nAstra's current management team at an upcoming Feb. 8
\nextraordinary shareholders meeting.<\/p>\n
IBRA has accused the management team of obstructing the
\nplanned sale of its equity shares in the company to an American
\ninvestor consortium led by Newbridge Capital and Gilbert Global
\nEquity.<\/p>\n
However, the management denied all the allegations, arguing
\nthat it wanted only to ensure that all securities market
\nregulations and good corporate governance practices were fully
\nobserved in the transaction.<\/p>\n
Meanwhile, a \"respected blue chip financial investor\" has
\nreportedly offered a better price for IBRA's stake in Astra.
\n(rei)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/ibra-may-delay-bca-share-issue-till-march-1447893297",
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