British firm invests $30 million in Astratel

JAKARTA (JP): British-based equity investor CDC Capital Partners injected US$30 million into telecommunications company PT Astratel Nusantara, taking 22.5 percent of the company's shares in return.

Astratel president Michael Ruslim said the capital injection was a follow-up to the strategic alliance formed by Astratel's parent company, publicly listed Astra International, and CDC Capital in June this year.

The money will be used by Astratel to develop its GSM-1800 mobile telephone network in Sumatra.

Astratel is expected to begin commercial operations of its mobile telephone service by the first quarter of 2001 in Medan, North Sumatra, and Batam, Riau.

It received in 1998 a government license in principal to operate a mobile telephone network in Sumatra and surrounding areas.

The company has a 35 percent stake in PT Pramindo Ikat Nusantara, a partner of state-owned telecommunications firm PT Telkom in the Joint Cooperation Scheme, under which it is authorized to build and operate fixed-line telephone services in Sumatra until 2010.

Astratel also will look to develop other potential telecommunications and Internet infrastructure-related businesses using some of CDC's $30 million investment.

The investment agreement was signed on Thursday by Astra International president Teddy P. Rachmat and CDC managing director Robert Binyon.

Astra International and CDC, which has invested some $2.5 billion on projects, including telecommunications-related businesses, in over 50 developing countries, entered their strategic alliance in June.

"CDC's investment in Astratel demonstrates that even during these uncertain economic times in Indonesia, a well-managed company can still raise financing from investors who have the vision and understanding to take advantage of the reforms taking place in the telecommunications sector," Rachmat said.