Surya Dumai Industry to build fiberboard plant<\/p>\n
JAKARTA (JP): PT Surya Dumai Industry (SDI), which plans to go
\npublic this year, announced yesterday that it will build a new
\nmedium density fiberboard (MDF) plant in Riau, with an investment
\nof US$35 million.<\/p>\n
The company's president, Citra Gunawan, said 70 percent of the
\ninvestment is to be generated from its planned initial public
\noffering, which is likely to be held in June this year, while the
\nrest is from the company's equity.<\/p>\n
The installation of the new project will commence next year.
\nIts commercial production is expected to start in 1997 and will
\nhave an annual production capacity of 50,000 cubic meters of
\nfiberboards, Citra said.<\/p>\n
He told journalists here over the weekend that the MDF plant
\nis a substitute for the planned expansion project of its plywood
\nplant.<\/p>\n
\"We intentionally withdrew our proposal to the Investment
\nCoordinating Board (BKPM) for the expansion of our plywood plant.
\nInstead, we will apply for the establishment of an MDF plant,\"
\nCitra said.<\/p>\n
He noted that SDI decided to shift to MDF production due to
\nstrong market prospects for such a product, both domestically and
\ninternationally.<\/p>\n
Demand for fiberboard in Asia alone reaches 1.75 million cubic
\nmeters annually, while total production from the continent is
\nonly 1.25 million cubic meters.<\/p>\n
\"Even fiberboards marketed here are all imported as domestic
\nMDF plants have not yet started their production,\" Citra said,
\nadding that MDF made its debut recently.<\/p>\n
Approval<\/p>\n
At least 15 companies have received approval from BKPM for
\nbuilding MDF plants, with a total capacity of around 1.95 million
\ncubic meters and a total investment of Rp 2 trillion (almost $1
\nbillion).<\/p>\n
Most of the 15 companies are controlled by conglomerates such
\nas Barito Pacific, which is led by tycoon Prayogo Pangestu, and
\nNapan Group by Henry Pribadi. SDI, a subsidiary of the Surya
\nDumai Group, is controlled by timber tycoon Mohamad (Bob) Hasan.<\/p>\n
To support its MDF project, Citra noted that Surya Dumai Group
\nhas developed 52,500 hectares of industrial forests and another
\n12,500 hectares of transmigration-related industrial forests.<\/p>\n
Along with PT Kiani Lestari, which is also owned by Bob Hasan,
\nand PT Artika Optima Inti, a subsidiary of the widely diversified
\nDjajanti Group, SDI is currently being assessed by the Geneva-
\nbased Societe Generale de Surveillance (SGS) as a preliminary
\nstep to going public.<\/p>\n
Citra said that SDI is supported by seven concessionaires
\nunder the Surya Dumai Group with a total forest acreage of
\n908,000 hectares.<\/p>\n
However, in addition to supplying logs for SDI with its annual
\nproduction capacity of 120,000 cubic meters of plywood, the seven
\nconcessionaires also supply logs for PT Perawang Lumber Industry
\nwith an annual production capacity of 110,000 cubic meters, which
\nis also under the Surya Dumai Group. (rid)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/surya-dumai-industry-to-build-fiberboard-plant-1447893297",
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"sponsor": "Okusi Associates",
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