CMEL buying shares in local securities firm

CMEL buying shares in local securities firm

JAKARTA (JP): Caribbean-based investment consortium Capital
Middle East Ltd. (CMEL) is buying up to 19 percent of shares of
securities firm PT Bhakti Investama to pave the way for its
expansion into the Indonesian capital market.

CMEL's director Nigel Oakes said on Thursday the stake in the
publicly listed firm would be acquired in stages to guard against
disturbing the local stock market.

"This afternoon CMEL is going to sign a 5 percent share
purchase of Bhakti Investama, and within 10 days CMEL should
acquire a total of 19 percent of Bhakti's shares," Oakes told a
news briefing.

He said the purchase of the securities company's stake would
help the Caribbean firm's operation in the Indonesian market.

"We consider Bhakti Investama to be our strategic partner in
Indonesia. Our further investment in Indonesia will be through
closely collaboration with Bhakti."

He said the Indonesian market remained promising despite
reports of unrest and fears of growing political tension ahead of
the country's June general election.

"CMEL is confident that after the June election, overseas
investors will burst into Indonesia, but by then we will not get
the best deals," he said.

CMEL has committed to investing US$250 million to $300 million
in listed companies with a strong management team, fine previous
trading record and which were undervalued, Oakes said.

"Besides those criteria, CMEL will have three categories of
investment, namely, property, loan default and loan
rescheduling," he said.

"CMEL sees that a large portion of property shares in
Indonesia are badly undervalued. We also see there are many
companies with high competency which are experiencing a loan
default and loan rescheduling. These companies cannot operate
merely because of financing problem. We want to help these
companies."

CMEL, with manages portfolio investments of $2.2 billion
worldwide, expects a 20 percent return per year from its
Indonesian investment. He added that the company booked an
average return of 18.2 percent per year for the last five years.

The company, which acquires funding from wealthy individuals
mostly in the Middle East, has also invested in other Asian
countries, including the Philippines, Thailand and Bangladesh,
according to Oakes. (02)