Miwon's underwriter fails to meet obligation<\/p>\n
JAKARTA (JP): The Capital Market Supervisory Agency (Bapepam)
\nhas ordered PT Sun Hung Kai Securities Indonesia to fulfill its
\nobligation in underwriting PT Miwon Indonesia's initial share
\noffering.<\/p>\n
Bapepam's chairman, I Putu Gede Ary Sutha, said on Tuesday
\nevening that he summoned the directors of Sun Hung Kai to explain
\nthe case. None of them showed up.<\/p>\n
\"Instead, the company's chief commissioner came to us. I told
\nhim that the company had to meet its commitment as stipulated in
\nthe prospectus,\" Putu said.<\/p>\n
Sun Hung Kai acted as lead underwriter for Miwon's public
\noffering last month. It underwrote 21.55 million shares of
\nMiwon's 25 million offered shares.<\/p>\n
Miwon shares, with a face value of Rp 500 (22 U.S. cents)
\neach, were sold at an initial price of Rp 1,950 each. The price
\nfell to Rp 1,450 on the listing day, Oct. 31, and only six
\nmillion shares of the total 25 million offered shares were sold
\nduring the initial public offering.<\/p>\n
Putu said Bapepam identified that Sun Hung Kai, as Miwon's
\nlead underwriter, had failed to absorb the rest of the unsold
\nshares.<\/p>\n
\"Sun Hung Kai agreed to underwrite Miwon on a full-commitment
\nprinciple. Therefore, it must pay up on the unsold shares,\" Putu
\nsaid.<\/p>\n
Putu explained that his agency interfered in the case of Miwon
\nand Sun Hung Kai because it dealt directly with the investing
\npublic's interest.<\/p>\n
\"If not resolved, it could destroy investors' confidence in
\nstock markets,\" Putu said. He added that the case could set a bad
\nprecedence for the development of local stock markets.<\/p>\n
None of Sun Hung Kai executives were available for comment
\nyesterday.<\/p>\n
The company is 85 percent owned by Sun Hung Kai Securities
\nLtd. of Hong Kong, 7.5 percent by Utomo Josodirdjo and 7.5
\npercent by the late businessman Omar Abdalla.<\/p>\n
Miwon shares have performed badly since the primary offering.
\nThe price fluctuations have never reached its initial price of Rp
\n1,950. Yesterday, Miwon fell again, to Rp 1,050.<\/p>\n
Bapepam recently urged Miwon to hold a public presentation to
\nexplain the plunge of the share prices to the investing public
\nand brokers.<\/p>\n
Bhakti Halim, a director of Miwon, said his company was not to
\nblame for the price drop because the fundamentals of the company
\nwere healthy. He blamed the price fall on market sentiment.<\/p>\n
He also refuted that the initial price was too high. He
\ncontended that with such a level of pricing, the Miwon price
\nearning ratio stood at 8.63 times, compared with the average
\nratio of 10 times for the shares of companies operating in the
\nfood and food-related industry.<\/p>\n
Miwon is 42.35 percent owned by Miwon Co. Ltd. of South Korea,
\n14.12 percent by Sewon Co. Ltd. of South Korea, 13.41 percent by
\nIntiputra Fikasa, 0.71 percent by Kayo Salim and 29.41 percent by
\nthe investing public.<\/p>\n
The company produces food seasonings, including monosodium
\nglutamate, dry glutamic acid, natural food condiment, flavored
\ntable salt, jelly powder and fishery products. (10\/rid)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/miwons-underwriter-fails-to-meet-obligation-1447893297",
"image": ""
},
"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
}