Bahana to build more venture capital firms

JAKARTA (JP): The state-owned venture capital company PT Bahana Artha Ventura, which last month started operating a venture capital firm in Bandung, West Java, will establish three more similar businesses in East Java and West Sumatra this year.

Bahana's director Hafiz Arief said yesterday that the newly established venture capital firm in Bandung, which was set up in cooperation with local companies with a paid-up capital of Rp 3 billion (US$1.4 million), is still assessing potential clients which mostly operate in the manufacturing industry.

"The other three capital venture firms will also have a paid- up capital of around Rp 3 billion each," he said.

The establishment of the venture capital firms outside Jakarta is essential in giving new companies in provinces more access to its services, he said.

Hafiz said that Bahana Artha has provided an equities totaling around Rp 2.5 billion to 11 newly established companies this year.

"Most of the companies receiving Bahana Artha's financial aid are operating well," he said. He, however, declined to disclose either the total amount of dividends it had collected or its outstanding equity participation.

He expected that Bahana Artha would provide equity for three other companies before the end of this year.

Response from small and medium-scale companies towards Bahana Artha's services was very encouraging, given the sharp increase in the number of new companies applying for its financial services, Hafiz said.

"But we can not meet all the requirements as only some of the applications are feasible," he said, describing that only less than five of around 35 companies applying for Bahana Artha's aid are eligible.

Hafiz said that most companies applying for financial assistance are not covered with enough legal bases, such as the necessary operational licenses. Furthermore, the majority of them lack skills in auditing their own financial reports.(hen)