Bayer to pull out from local bourse

Bayer to pull out from local bourse

Rendi A. Witular, The Jakarta Post, Jakarta

The extraordinary shareholders meeting of PT Bayer Indonesia,
a local unit of German-based pharmaceutical giant Bayer AG,
approved on Friday the company's plan to voluntarily delist its
shares from the Jakarta Stock Exchange (JSX).

President of Bayer Indonesia Hans-Josef Schill said the reason
behind the move was because the company's future financial
sources would be handled directly by Bayer AG as the holding
company, meaning that all subsidiaries of Bayer AG will no longer
be allowed to seek separate sources of financing.

"The restructuring of Bayer AG as a holding in 2002 has made
it a financial resource for all its subsidiaries all over the
world," said Schill in a press briefing.

He explained that for the last few years, the company's shares
were liquid enough and the trading volume was very low.
Therefore, investors at the stock exchange would not gain any
benefits out of the shares.

The decision to go private would allow the JSX to concentrate
more in managing active shares, he said.

The JSX suspended the trading in the company's shares on Sept.
5 because of the voluntary delisting plan, with the last closing
at Rp 8,000 per share.

Bayer Indonesia, one of the country's largest pharmaceutical
firms, has allocated at least Rp 162 billion (US$19.5 million) to
buy back its shares from the public.

Currently, the company has 3.59 million Serie A shares and
1.75 million Serie B shares.

Bayer AG, as the major shareholder of the company, is willing
to buy all shares from the public for Rp 28,000 per Series A
share, and Rp 35,000 per Series B share.

Bayer Indonesia will tender off its shares starting in January
next year. The company is currently still waiting for a further
announcement from the JSX on the effective date of the delisting.

During the meeting, Schill also dismissed circulating rumors
that Bayer Indonesia's voluntary delisting from the JSX was part
of the company's preparation to pull out of the country
completely.

"The delisting will not affect Bayer's overall operations in
Indonesia. We don't have any intention at all to relocate or to
shut down our factories here," he said, adding there was now only
one Bayer AG unit listed on a local stock market elsewhere in the
world -- in India.

Bayer Indonesia listed its shares on the local bourse in
August 1982. Currently, the company's majority shares, 87.41
percent, are held by Bayer AG with the remaining 3.95 percent and
8.64 percent owned by PT Bayer Kimia Farmasindo and the public
respectively.

Elsewhere, Schill said that by the end of this year, Bayer's
sales would reach around Rp 500 billion, a relatively flat growth
compared to last year's Rp 533 billion.

However, net profit for this year was likely to decline
because of the impact of the divestment of Bayer's household
insecticide business to PT SC Johnson & Son Indonesia, said
Schill.

The divestment is part of Bayer AG's global divestment to SC
Johnson in 2002. The business sold to SC Johnson produces brands
such as Baygon, Autan, Bayclin and Bayfresh.

Last year, Bayer Indonesia recorded a net profit of Rp 153
billion.

In the first semester of this year, the company's sales
declined to Rp 362 billion from Rp 452 billion in the same period
of last year. But its net profit surged to Rp 50 billion from Rp
26.4 billion.