Aneka Tambang sets share price

Aneka Tambang sets share price

JAKARTA (JP): State-owned mining firm PT Aneka Tambang and its
underwriters agreed yesterday to set the price of shares for the
company's initial public offering (IPO) early next month at
between Rp 1,400 and Rp 1,800 a share.

The company's finance director, Ki Agus Umar Tochfa, said in a
statement that the price range was based on the response from
both local and foreign investors during road shows.

"Looking at the positive response from domestic and overseas
investors during our road shows, we are optimistic that we can
get the best pricing," he said.

He added that the fixed pricing would be decided by the
government early next month.

Aneka Tambang has appointed PT Danareksa Sekuritas, PT Bahana
Securities and PT Pentasena Artha Sentosa as underwriters for its
IPO.

The company will offer around 430.76 million shares to the
public through the Jakarta and Surabaya stock exchanges.

It said that about 73 percent of the proceeds from the share
offering would be used to develop a nickel plant in Pomalaa,
Central Sulawesi, 9 percent to build a geothermal power plant for
the Pomalaa nickel plant and the rest to refinance the company's
loans.

Securities analysts in Jakarta said Aneka Tambang's IPO should
boost stock-trading activities in the market.

"I think most investors are interested in Aneka Tambang after
seeing how nickel mining company Inco and tin mining PT Tambang
Timah performed well during this current market volatility," Edi
Widjoyo, a mining analyst with Mashill Jaya Securities, told The
Jakarta Post.

The share price of Inco almost quadrupled recently, closing at
Rp 7,100 yesterday against a year-low of Rp 2,300 in late August
and a year-high of Rp 8,800 in late July.

Tambang Timah, also listed in London, made strong gains in the
gloomy market to close at Rp 4,150 yesterday against a year-low
of Rp 3,000 in late July.

"It is this factor which will boost Aneka Tambang shares.
Besides, Aneka Tambang has sound fundamentals, low debt and
earnings in dollars," Edi said.

Tochfa said the sharp depreciation of the rupiah against the
U.S. dollar would become a windfall of profit for the company as
most of its revenue was generated in dollars.

"More than 90 percent of the company's revenue is in dollars
while most of our costs are in rupiah," Tochfa said.

Aneka Tambang posted a net profit of Rp 24 billion in the
first half of this year, compared to Rp 22.6 billion in the
corresponding period last year.

The company expected a net profit of Rp 69 billion this year,
up from Rp 44.29 billion in 1996.

Besides, Edi Widjojo said, Aneka Tambang's listing would be
fully supported by state-related institutional investors,
including pension funds.

President Soeharto asked pension funds and state-owned firms
earlier this month to have a more active role in local stock
markets, which have been suffering from the currency turmoil.
(aly)