Bakrie Land plans to issue rights

JAKARTA (JP): PT Bakrie Land Development, a property arm of the Bakrie business group, plans a rights issue later this year to strengthen the company's capital structure.

Iwan Hendradi, the firm's president, said here yesterday the company expected shareholders to approve the plan within the next two months.

Hendradi, a former managing director of PT Catur Swasakti Utama, said the limited public offering would raise fresh funds to finance new projects.

The company's assets are currently Rp 250 billion (US$104.16 million) and are expected to increase to between Rp 3 trillion and Rp 4 trillion in the next three years.

"A lot of Bakrie Land's assets have not been optimally exploited yet," he said after the company's shareholders' meeting.

Bakrie Land was Elang Realty before being taken over in March by Bakrie Capital Indonesia, a Bakrie Group holding company.

Bakrie Capital bought a 70 percent stake in Elang Realty for Rp 150 billion.

He said Bakrie Land would buy property projects of other Bakrie subsidiaries, Bali Nirwana Resort in Bali, Bakrie Tourism Resort in Lampung and Taman Rasuna in Jakarta.

"We want to make Bakrie Land Development as strong as any other property firm in the coming years," he said.

He said the company also planned to buy property projects from other companies. "We are considering buying other projects like we did with Gelael supermarket recently," he said.

Bakrie Land and PT Goro Batara Sakti set up a joint venture Monday called PT Bakrie Goro Land. It is 51 percent owned by Bakrie Land Development and 49 percent by Goro Batara Sakti.

The new joint venture also signed an agreement Monday to form PT Gelael Batara Bakrie to operate the Gelael supermarket, owned 60 percent by Bakrie Goro Land and 40 percent by Gelael.

The joint venture will provide land and infrastructure for Gelael's new outlets.

Hendradi said that this year Gelael Batara Bakrie expected to buy about seven more properties for PT Goro Batara Sakti in Jakarta.

Hendradi said Bakrie Land posted a total net loss of about Rp 200 million in the first quarter of 1997, down from first quarter losses of around Rp 1 billion last year.

"We expect to register a profit this year," he said.

He said the firm booked a total revenue of Rp 2.1 billion in the first three months of 1997 and net expenses of Rp 2.3 billion. (09)