Bakrie Plantations to launch rights issue

Bakrie Plantations to launch rights issue

The Jakarta Post, Jakarta

Publicly listed PT Bakrie Sumatra Plantations, which owns about 30,000 hectares (ha) of oil-palm plantations in Indonesia, plans to sell 1.1 billion new shares via a rights issue to raise cash to finance its expansion programs.

The sale, slated for Nov. 10, will fund the acquisition of plantation firms and debt repayments, the company said on Monday.

While it did not provide details on how much Bakrie planned to raise nor how much debt it intended to pay, president director Ambono Janurianto had previously told The Jakarta Post the rights issue was expected to raise between Rp 200 billion (US$21.97 million) to Rp 300 billion.

The Jakarta-based company said it planned to acquire 85 percent shares in PT Agro Mitra Madani, which operates about 11,000 ha of oil-palm plantations, and 100 percent shares in PT Huma Indah Mekar, which has 4,400 ha of rubber plantations.

Ambono said Bakrie projected the acquisitions would boost sales revenue this year by at least 40 percent on higher production and commodity prices.

Last year, Bakrie recorded sales of Rp 457 billion, up from Rp 357 billion in 2002, and a net profit of Rp 80 billion, against Rp 75.9 billion in 2002.

The company is also in the process of splitting its stock to smooth the shares sale at a more affordable price for investors.

Bakrie Sumatra Plantations is 52.5 percent owned by Bakrie Group, with the rest held by the investing public.