Djajanti awaiting recommendation before going public
JAKARTA (JP): PT Artika Optima Inti (AOI), a wood panel manufacturer affiliated with the Djajanti Group, is still awaiting the green light from the forestry minister before issuing 66 million new shares that will account for 30 percent of its enlarged shares.
Deswandhy Agusman, executive director of Peregrine Sewu Securities, the lead underwriter of the share issuance, said that the minister will soon release his recommendation after his ministry conducts site examinations of the company's 17 forest concessions.
He explained that the company would hold a public presentation on April 6 without waiting for the forestry minister's recommendation.
A.D. Erlangga, the company's forestry director, told The Jakarta Post that he is optimistic that the approval will be released soon because AOI presented the details of its planned share issue to forestry ministry officials in February.
The share issuance is expected to raise Rp 450 billion (US$210 million), of which 30 percent will be used to finance the acquisition of a 70-percent stake in Maluku Dinamika Semen, a cement producer in Ambon, 30 percent to repay its debts, 15 percent to increase working capital and 25 percent to purchase new plant equipment.
Maluku Dinamika is now building a cement plant on Seram island with a capacity of 2.1 million tons a year. It has been authorized by the Investment Coordinating Board (BKPM) to export 85 percent of its production.
Deswandhy explained that the investment for the cement factory will likely reach Rp 600 billion and its construction is scheduled for completion next January.
He said the Djajanti Group will hold road shows in 20 major cities, including Tokyo, Hong Kong, New York, Chicago, London, Paris and Amsterdam from April 10 to April 20 to promote the shares.
Established in 1981, AOI, which handles its logging, saw milling and panel board manufacturing activities in Seram, is the first integrated wood-based company in the eastern part of Indonesia.
The Djajanti Group was established in 1956 in Banjarmasin, South Kalimantan, in timber logging and forest-related industries. It established its food processing and fishery businesses in 1979.
The group, chaired by Burhan Uray, is one of the largest forest-based companies with 17 forestry concessions covering 3.7 million hectares.
With total assets of $530 million, the group's annual turnover exceeds $370 million. It has over 60 subsidiaries and has more than 30,000 employees. (03)