Disappointed Indosat workers plan rallies, strike this week

Disappointed Indosat workers plan rallies, strike this week

Moch. N. Kurniawan, The Jakarta Post, Jakarta

Disappointed with the divestment of state international call
operator PT Indosat, the workers' union at the company is
planning to stage mass rallies on Monday and Tuesday as well as a
strike on Friday to force the government to cancel the recent
sale of the company to a Singaporean firm.

Indosat Worker Union (SP Indosat) chairman Sukur Mulyamadi
said on Sunday the demonstration on Monday and Tuesday would have
around 1,500 Indosat workers. The rallies will be held in Jakarta
during their work break.

Should the government reject workers demands to terminate
Indosat's sale, all 2,300 Indosat workers in the country would go
on strike by Friday, Sukur warned.

Indosat has offices in Medan (North Sumatra), Batam (Riau),
Bandung (West Java), Surabaya (East Java), Bali and Balikpapan
(East Kalimantan).

On Friday, Indosat will hold an Annual Shareholders' General
Meeting, in which one of its agendas is to approve the recent
sale of the government's 41.9 percent stake in the company worth
Rp 5.6 trillion (US$610 million) to Singapore Technologies and
Telemedia (STT).

Sukur said the sale of Indosat was improper because the price
was too cheap and the sale had caused fear of mass layoffs of
unproductive workers.

"I still don't understand why the government sold Indosat so
cheaply, despite strong performances, which has given the
government a lot of dividend money," he told the Jakarta Post.

"In our calculation, Indosat should be sold at Rp 6.4
trillion, or Rp 1.8 trillion more, as we're the second largest
telecommunications company in the country and we have a number of
potential businesses ranging from cellular, fixed communications,
multimedia, data and Internet services," he added.

He added that it was difficult to understand why the
government sold Indosat at the price of Rp 12,950 per share, much
lower than the price of Indosat's subsidiary Satelindo, whose
shares were valued at Rp 14,000 a piece.

He also said, based on the latest meeting between workers and
STT, the latter was not interested in continuing with Indosat's
existing plan to build fixed lines, thus causing fears of job
cuts.

Asked to comment on STT's new stance that it was committed to
developing fixed lines, Sukur said: "We haven't heard such news
from STT directly."

According to him, the workers would only agree with the
privatization program of Indosat, if the price was fair and the
partner would guarantee no layoffs.

The latest deal has reduced the government stake in Indosat to
15 percent, but at the same time, it has brought the total
earnings from this year's privatization program to over Rp 8
trillion, exceeding the full-year target of Rp 6.5 trillion.

The government has insisted that the privatization program is
important to help with the budget deficit and restore investor
confidence in the country's economy.

"One of the main aims of the program is to promote a flow of
investments into the country's strategic industries," State
Minister for State Enterprises Laksamana Sukardi said recently.

The successful Indosat sale sends a signal that the country is
committed to its reform agenda and not all investors were shying
away from the country, according to observers.