Singapore bans Kotjo from takeover bids<\/p>\n
SINGAPORE (Reuter): The Stock Exchange of Singapore's (SES)
\npunishment of an Indonesian businessman for "misleading" the
\nmarket is likely to dampen speculation in stocks with big
\nIndonesian investors, dealers said yesterday.<\/p>\n
The SES rebuked Johannes Kotjo on Friday for creating what it
\nsaid was "a false market" in the shares of United Pulp & Paper
\n(UPP), a paper firm in which he and other Indonesian businessmen
\nhad taken large buy options.<\/p>\n
The SES banned Kotjo from directorships in any listed firms,
\nother than those already held, for 30 months.<\/p>\n
Kotjo is a director of engineering firm Van der Horst and ice
\ncream vendor ABR Holdings.<\/p>\n
Dealers said the SES's action, which follows six months of
\nheavy speculation in Singapore firms with prominent Indonesian
\nshareholders, was a warning to all to abide by the bourse's rules
\nof disclosure on market-sensitive news. It was also likely to
\ncurb investors' enthusiasm for Indonesian-linked firms.<\/p>\n
Shares in several such companies, including UPP and Amcol
\nHoldings, in which Indonesian businessman Henry Pribadi has a
\n18.23 percent stake, fell heavily yesterday as the market
\ndigested the SES action after the New Year holiday.<\/p>\n
"The bubble has been burst," said Lim Eng Hai, head of
\nresearch at J.M. Sassoon & Co. "It won't put an end to takeover
\nspeculation entirely but it will remind the market to look a
\nlittle more closely at rumors of takeovers."<\/p>\n
Takeover fever swept the Singapore stock market in mid-1995
\nfollowing a spate of purchases of small and medium-sized local
\nfirms by Indonesian investors.<\/p>\n
One of the first was Van der Horst, in which Kotjo and
\nPresident Soeharto's son, Bambang Trihatmodjo, had taken stakes.<\/p>\n
"Van der Horst had been a rather poor share for some time,"
\nsaid William Cliffe, institutional broker at DBS Securities.<\/p>\n
"Then Kotjo came in and used his contacts to get some good
\ncontracts in Indonesia. People hope (Indonesians) will have the
\nsame magic touch on other companies."<\/p>\n
Just a rumor about Indonesian money has sometimes been enough
\nto move a share. Often the rumors are inflated or untrue.
\nKotjo's reprimand on Friday was for feeding such rumors.<\/p>\n
Misleading<\/p>\n
The SES said that shortly after he took a series of buy
\noptions in UPP's shares that would have triggered a formal
\ntakeover if exercised, Kotjo made a series of optimistic
\nstatements on UPP's prospects, some of which were misleading.<\/p>\n
The SES said Kotjo had suggested in an interview that UPP
\nmight be merged under the new management with another timber
\ncompany.<\/p>\n
UPP shares soared to S$2.07 (US$1.48) from S$1.21 on the day
\nof the interview.<\/p>\n
But the SES said Kotjo had later admitted there was no
\nimmediate intention of merging the operations of the companies.<\/p>\n
"Kotjo's actions had misled the market and created a false
\nmarket in the shares of UPP," the SES statement said.
\nKotjo was unavailable for immediate comment.<\/p>\n
Lim said the SES's action was a warning that takeover deals
\nwould be closely scrutinized and directors of companies must not
\nsuggest things that were not true.<\/p>\n
Cliffe said the SES wanted to reinforce Singapore's squeaky-
\nclean reputation.<\/p>\n
"The SES's action is very unlikely to have any impact on the
\nlevel of speculative activity in the Singapore market," said
\nCliffe "But the focus may move away from Indonesian investors to
\nanother type of play -- probably another regional play."<\/p>\n
By yesterday's close, UPP stood at S$2.05, down 62 cents on
\nmore than 12 million shares. Amcol was 16 cents lower at S$3.74
\non 5.5 million shares. L&M Group Investment Holdings, in which
\nKotjo's consortium holds a 39.74 percent stake, was 50 cents
\nlower at S$3.32.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/singapore-bans-kotjo-from-takeover-bids-1447893297",
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"sponsor": "Okusi Associates",
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