City to create five holding companies
City to create five holding companies
JAKARTA (JP): The city administration will establish five
holding companies in a bid to restructure all of the 33 city-
owned companies with the first one to be launched on Dec. 15, an
official said on Friday.
City Secretary Fauzi Bowo said that the city administration
had also conducted fit-and-proper tests for all 69 candidates,
mostly executives of the existing firms plus several members of
major political parties proposed by the city council, to be
placed as directors of the holding firms.
"From the 69 officials, only nine or 10 of them are eligible
and qualified for the posts," Fauzi told journalists, adding that
the results of the tests could actually explain why the 33 firms
experienced such poor performance for so many years.
Fauzi, however, did not explain whether those executives who
failed the test would be fired from their current jobs or not.
He only said that the test results would be submitted to
Governor Sutiyoso for further approval ahead of the preparation
for the establishment of the first holding company, which would
focus on property.
"The governor will decide those qualified to fill the position
on the board of directors or commissioners of the (first) holding
company," he remarked.
Fauzi explained that, based on the tests, only two of the nine
or 10 candidates had the qualifications to lead such a property
holding company.
"The holding firm will be a merger between developer firms PT
Pembangunan Pluit Jaya, PT Pulo Mas Jaya and PT Pantura Jaya. A
few months after that, PT Sarana Jaya and PT Pulo Gadung Area
will join the company shortly after the completion of their due
diligence," Fauzi said.
Poor performance
According to Fauzi, the purpose of the massive restructuring
of the city firms and the establishment of the holding firms is
to further improve their performance.
"Many have questioned the ability of the companies to make a
profit for the city," he said.
The initiative has also been one of the commitments of
Governor Sutiyoso in a bid to improve his performance as governor
ahead of his accountability speech early next year, Fauzi added.
The five holding companies will focus their business
activities on property, trading and manufacturing, finance and
insurance, hotels and tourism, and general services.
"All of the five holding firms will be under the coordination
of an institution to be called Jakarta Incorporated, and the
governor will be the chief commissioner," Fauzi said.
The process to merge these companies into holding firms will
take some time as each company will be appraised by an
independent public accountant to check their assets, debts, human
resources, profits and corporate culture.
"And the three companies that will be merged on Dec. 15, are
the most eligible ones," Fauzi added.
Separately, City Economy Development Office chief Dameria
Saragih said that under the new structure, city officials would
no longer be allowed to be placed as a member of the board of
commissioners in any of the companies.
"The governor will only be the chief commissioner of the group
that covers the five holding companies," Dameria said. (dja)