Biddings for Telkomsel's shares is getting heated

JAKARTA (JP): The competition between overseas telecommunications operators to win the bid for a portion of the state-owned digital cellular telecommunications operator, PT Telkomsel, is becoming heated as the company is expected to announce its suitor soon.

A top executive of the Dutch PTT Telecom in Indonesia, J.B. Volbeda, told reporters here on Wednesday that Telkomsel, which runs the Global System for Mobile Communications (GSM) cellular telephone, is likely to announce the winner within the next couple of months.

"I think the company has already received all the bidders' specifications. Two or three months will be appropriate to make a decision," he said.

His company, Volbeda said, has proposed to buy 25 percent of Telkomsel's shares.

"We actually would like to bid for more but Telkomsel offers only a maximum of 25 percent to foreign shareholders," he added.

Telkomsel is 51 percent controlled by the state-owned domestic telecommunications operator PT Telkom, while the rest is owned by international calls operator PT Indosat, which is partially listed on both the Jakarta and New York stock markets. Telkom is expected to float its shares on domestic and foreign bourses later this year.

Telkomsel, officially established in May, was capitalized at Rp 650 billion (US$287 million). After performing a successful GSM pilot project in Batam and Bintan islands, it plans to enter the key Jakarta market early next year.

The company expanded its business recently into North and West Sumatra. On Tuesday, Telkomsel also launched its expansion in Bali and West Nusa Tenggara as well as introducing KartuHALO, the subscriber identity module (SIM) card which must be used in GSM handsets.

At least eight foreign telecommunications operators have been bidding for Telkomsel's shares. Among them are PTT Telecom, Telstra of Australia, France Telecom, NTT of Japan, AT&T of the United States, British Telecom, Voda Phone of Britain, Nynex of the United States. Leading investment firm Goldman Sachs of the United States is assisting Telkomsel in evaluating the bids.

However, Mitsui of Japan, Nynex of the U.S. and Telekomindo Primabhakti of Indonesia have been appointed as the country's third GSM operator.

The new company, called PT Excelcomindo Pratama, will be 60 percent owned by Telekomindo and its local partners, 30 percent by Nynex and 10 percent by Mitsui.

PT Satelindo, another GSM operator in the country, picked last March DeTeMobil, a subsidiary of Deutsche Telekom, as its partner with a 25-percent shareholding worth of $586 million after a fierce bidding battle with Cable & Wireless of Hong Kong. Satelindo's other shareholders now consist of Telkom with 22.5 percent, Indosat with 7.5 percent and PT Bima Graha with 45 percent. Bima Graha is partly owned by the Bimantara group of President Soeharto's son Bambang Trihatmodjo.

Volbeda said that his company started last year to develop a GSM project in the Netherlands where there are some 100,000 subscribers currently listed.

A source at Telkomsel told The Jakarta Post on Wednesday that more than 10 firms have actually expressed interests in joining Telkomsel, but the company is looking for only one foreign partner and a decision must be made this year. (icn)