State cement firms consolidated<\/p>\n
JAKARTA (JP): Three state-owned firms, PT Semen Gresik, PT
\nSemen Padang and PT Semen Tonasa, signed an agreement yesterday
\non their consolidation to become the country's single largest
\nproducer.<\/p>\n
Director General for State Enterprises Martiono Hadianto, on
\nbehalf of the government, signed the agreement with the
\npresidents of the three cement companies in a ceremony, with
\nMinister of Finance Mar'ie Muhammad and Minister of Industry
\nTunky Ariwibowo witnessing.<\/p>\n
Under the agreement, the government's shares, worth Rp 1.1
\ntrillion (US$484.1 million) in Semen Padang and Semen Tonasa,
\nwere consolidated into Semen Gresik.<\/p>\n
\"Under the agreement, the management of Semen Padang and Semen
\nTonasa will be overseen by Semen Gresik,\" Martiono said.<\/p>\n
To finance the acquisition of the two firms, Semen Gresik
\nraised funds from the public in August, by issuing 444.8 million
\nrights shares at Rp 3,275 each.<\/p>\n
According to PT Bahana Securities, the underwriter of the
\nrights share issuance, the shares allocated for foreign investors
\nwere oversubscribed by four times.<\/p>\n
Yesterday's consolidation has combined the annual production
\ncapacities of the three companies to 8.85 million tons.<\/p>\n
Semen Gresik's production units in East Java have an annual
\ncapacity of 4.1 million tons, Semen Padang's plant in West
\nSumatra 3.3 million tons and Semen Tonasa's plant in South
\nSulawesi 1.3 million tons.<\/p>\n
After completing construction of Semen Tonasa's new production
\nunit next year, Semen Gresik's consolidated production capacity
\nwill increase to 10.9 million tons a year, making it the largest,
\namong cement producers, in Indonesia.<\/p>\n
Currently, Indocement is the largest cement producer, with a
\nproduction capacity of 9.2 million tons per annum.<\/p>\n
The price of cement is vulnerable to abrupt hikes due to
\nseasonal shortages of supplies.<\/p>\n
Minister of Trade Satrio B. Joedono said in a hearing with the
\nHouse of Representatives recently that Indonesia's total annual
\nproduction of cement is 24 million tons. After the expansion of
\nsome existing plants and the establishment of six new factories,
\nthe total capacity will increase to about 43 million tons in
\n1998.<\/p>\n
\"The instability of cement prices will be settled in 1998,
\nwhen the capacity exceeds the country's demand of about 37
\nmillion tons,\" said Joedono. (kod)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/state-cement-firms-consolidated-1447893297",
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"sponsor": "Okusi Associates",
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