Market positive about RI privatization plan<\/p>\n
JAKARTA (JP): The international market is positive about
\nIndonesia's plan to privatize state firms, according to
\ninvestment bank Goldman Sachs.<\/p>\n
Goldman Sachs (Asia) L.L.C. managing directors Peter G.C.
\nMallinson and Timothy D. Dattels told journalists here yesterday
\nstate-owned "quality companies" would sell well.<\/p>\n
"Very high quality companies could meet good interests.
\nWhether PT Telkom or Indosat... plus other unlisted companies,
\nat the moment there are investors who are willing to put a
\nsubstantial amount of money into an attractive Indonesian equity
\nor equity-linked issue," Mallinson said.<\/p>\n
He was referring to the government's recent announcement to
\nmake additional divestment in five state listed firms and float
\nseven more state firms.<\/p>\n
The five listed firms which the government will divest more of
\nits stake are local telephone operator PT Telkom, satellite
\noperator PT Indosat, cement producer PT Semen Gresik, tin mining
\nfirm PT Tambang Timah and nickel and gold mining company PT Aneka
\nTambang.<\/p>\n
The seven companies being prepared for initial public offering
\nare PT Krakatau Steel (steel maker), PT Pelindo II and PT Pelindo
\nIII (port infrastructure and management), PT Jasa Marga (toll
\nroads), PT Perkebunan Nusantara IV (oil palm plantations), PT
\nTambang Batubara Bukit Asam (coal mining), and PT Angkasa Pura II
\n(airport management).<\/p>\n
Dattels, the head of Goldman Sachs' investment division for
\nAsia, excluding Japan, added: "We have a lot of confidence in
\nTanri Abeng and his team. They have deep understanding on the
\nissue of privatization."<\/p>\n
Tanri Abeng is the state minister of the empowerment of state
\nenterprises.<\/p>\n
Dattels noted that the "successful" offering of Asia Pulp and
\nPaper (APP)'s US$500 million convertible bonds indicated that
\nconfidence was building up on Indonesia's economy.<\/p>\n
"Somebody investing in APP is ultimately investing in
\nIndonesia. To us, this transaction is a major vote of confidence
\non Indonesia's economy," he said.<\/p>\n
He said APP's offering size was initially indicated at $250
\nmillion. However, because of strong demand from the market, with
\noversubscription of six times the offer, the final deal totaled
\n$500 million.<\/p>\n
About 80 percent of the total were U.S.-based investors,
\nEuropean investors accounted for 15 percent and Asians 5 percent.<\/p>\n
Some critics, however, have said that the success of APP's
\n$500 million issue should not necessarily reflect the return of
\nforeign investors' confidence in Indonesia as APP is basically a
\nSingapore company listed on the New York Stock Exchange.<\/p>\n
Dattels dismissed such criticism, saying that although APP is
\nincorporated in Singapore, the market viewed it as an Indonesian
\ncompany as most of its assets are in Indonesia.<\/p>\n
APP, a forest product group, is 86.2 percent owned by APP
\nGlobal Ltd., a company controlled by the Sinar Mas Group.<\/p>\n
APP has integrated operations of forestry management, pulp
\nmanufacture, fine paper and industrial paper manufacture and
\npaper distribution.<\/p>\n
Its subsidiaries include PT Indah Kiat and Paper, PT Pabrik
\nKertas Tjiwi Kimia, PT Lontar Papyrus Pulp and Paper Industry and
\nPT Pindo Deli Pulp and Paper Mills -- all in Indonesia.<\/p>\n
While well established on several large-scale sites in
\nIndonesia, the APP group more recently has expanded its
\noperations to India and China and is committed to a large pulp
\nmill in Malaysia.<\/p>\n
Mallinson, the head of Goldman Sachs' equity division for
\nAsia, excluding Japan, noted that APP happened to be in an
\nindustry which had been enjoying increasing sales prices in
\ndollar terms.<\/p>\n
He said the sales of such export-oriented companies would be
\nwarmly welcomed by the market. Besides, state companies in
\nstrategic industries or those with large domestic franchises and
\nstrong management teams would also sell well in the market,
\nprovided they had a healthy level of debt. "Investors are very
\nsensitive about debt levels." (rid)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/market-positive-about-ri-privatization-plan-1447893297",
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