Minister holds up recommendation for Djajanti's share issue<\/p>\n
JAKARTA (JP): Minister of Forestry Djamaloedin
\nSoeryohadikoesumo will not recommend a share issue for PT Artika
\nOptima Inti (AOI) unless the Djajanti Group's wood panel
\nmanufacturer is able to fulfill its forest concession obligations
\nin Irian Jaya.<\/p>\n
Djamaloedin said yesterday that based on the company's forest
\nconcession agreement, it is required to develop a wood processing
\nunit in Irian Jaya.<\/p>\n
The major part of the wood from the company's Irian Jaya
\nconcession should be processed in Irian Jaya. The minister's
\nrecommendation is contingent upon AOI's commitment to fulfilling
\nits obligation.<\/p>\n
The logs from AOI's Irian Jaya forest concession are now
\nprocessed on Seram island in Maluku, the company's wood
\nmanufacturing center in the eastern part of Indonesia.<\/p>\n
Theo Lekatompessy, AOI's corporate secretary, told The Jakarta
\nPost that the reason the wood is processed on Seram island is
\nefficiency. The company's forest concessions are not only located
\nin Irian Jaya but also in Sulawesi and Maluku.<\/p>\n
He said that, in 1980, Irian Jaya's governor of the time,
\nIsaac Hindom, approved AOI's request to take wood from there to
\nbe processed on Seram island.<\/p>\n
Hindom is now an adviser to the Djajanti Group.<\/p>\n
Going ahead<\/p>\n
A.D. Erlangga, AOI's forestry director, told newsmen in the
\npublic presentation on the planned share issue yesterday that the
\ncompany will go ahead with its plan to sell 66 millions shares,
\nclaiming AOI has already fulfilled all of the requirements as set
\nby the ministry.<\/p>\n
He explained that the forestry ministry team is still doing a
\nsite examination of the company's 17 forest concessions.<\/p>\n
The company is expected to raise Rp 400 billion to Rp 500
\nbillion from the share offerings, of which 38 percent will be
\nused to repay debts, 33 percent to finance the acquisition of a
\n70 percent stake in Maluku Dinamika Semen, a cement company in
\nAmbon, 10 percent to purchase electrical turbines, seven percent
\nto develop industrial forests, six percent to increase working
\ncapital and six percent to buy new machines.<\/p>\n
The company, which operates 12 lines of plywood production in
\nSeram, yesterday reported a net profit of Rp 47.4 billion (US$22
\nmillion) from a total sales of Rp 282.7 billion last year.<\/p>\n
The forestry minister said that he did not object to the way
\nthe funds to be raised from the public offering would be used,
\nbut suggested that at least 70 percent of the funds be invested
\nin forestry, especially the forest concession which the firm has
\nbeen cultivating for so many years.<\/p>\n
\"Without forest conservation they cannot maintain their
\nbusiness and the investors will not have a profitable
\ninvestment,\" he said.<\/p>\n
The initial public offering of AOI's shares is scheduled for
\nMay 18 to May 20. The firm is expected to be listed on the
\nJakarta Stock Exchange and Surabaya Stock Exchange on June 22.
\n(03\/10)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/minister-holds-up-recommendation-for-djajantis-share-issue-1447899208",
"image": ""
},
"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
}