Angkasa Pura wants Jakarta airport royalties
JAKARTA (JP): PT Angkasa Pura II, the state-owned airport operator, has asked that it continue to receive royalties from Soekarno-Hatta International Airport after it is privatized.
The company made the request because it says it needs the funds to help pay for the operation of the other nine airports under its management.
Soekarno-Hatta accounts for about 80 percent of Angkasa Pura II's total earnings, and its divestiture will mean a significant loss for the company, president Miskul Firdaus said during a hearing with the House of Representatives on Wednesday.
"(Because of the privatization), the company will lose its largest source of revenue," Miskul said, adding that Soekarno- Hatta virtually subsidized the operations of the other airports.
Falling short of calling for a suspension of the privatization process, he proposed that Angkasa Pura continue to receive some royalties from the airport, though he did not elaborate on his proposal.
Angkasa Pura II also operates the Sultan Iskandar Muda Airport in Banda Aceh, Polonia Airport (Medan), Tabing Airport (Padang), Sultan Syarif Kasim II Airport (Pekanbaru), Sultan Mahmud Badaruddin II Airport (Palembang), Supadio Airport (Pontianak), Husein Sastranegara Airport (Bandung), Halim Perdanakusumah Airport (Jakarta) and Kijang Airport (Tanjung Pinang).
Soekarno-Hatta airport, which is located in Tangerang, near Jakarta, is one of eight state enterprises earmarked for privatization by the government, which hopes to raise Rp 6.5 trillion (US$684 million) to help finance the 2001 state budget deficit.
Miskul pleaded his case for continued royalties during a hearing with House Commission IV for infrastructure and transportation affairs. The hearing also was attended by executives of Angkasa Pura I, which operates 13 airports, including ones in Bali and Surabaya.
Angkasa Pura II booked Rp 1.29 trillion ($136 million) in earnings last year, an increase of about 60 percent from the previous year, Miskul said when disclosing the company's unaudited financial results. It had a pretax profit of Rp 522.10 billion, up from Rp 280.13 billion the previous year.
Miskul said Soekarno-Hatta airport would be privatized through direct placement offers to potential strategic partners, not through an initial public offering.
This will give the government the opportunity to select its partners, he said.
"The partners will come from professional players in the airport business," he added.
The direct placement also will make the transfer of technology and skills easier to carry out, he said.
The government intends to sell a 50 percent stake in Soekarno- Hatta airport -- valued at an estimated Rp 3.5 trillion ($368 million) at the end of 2000. Bidders for the stake have included the companies that manage the Dutch Schipol Airport and Aeroport de Paris, and the British Airport Authority.
No decision has been made because all of the bidders offered a price lower that what was hoped for by the government, he said. (03)