Electricity firm seeking partners in joint ventures

Electricity firm seeking partners in joint ventures

JAKARTA (JP): The state electricity company PT Perusahaan
Listrik Negara (PLN) is looking for partners among domestic and
foreign firms for cooperation in the establishment of two
subsidiaries which will be prepared for going public.

PLN's president, Zuhal, told reporters here yesterday that the
company plans to start the operation of its two subsidiaries next
year.

The planned subsidiaries will comprise of PT Pembangkit Jawa
Bagian Barat, which will be responsible for the operation of
PLN's power plants in West and Central Java, and PT Pembangkit
Jawa Bagian Timur, which will control the operation of power
stations in East Java and Bali.

"Due to our lack of experience in establishing a new business,
we are looking for foreign partners which have long been involved
in the power industry with strong capitalization," Zuhal said,
adding that domestic partners would also be welcomed.

He said four foreign power corporations have applied to join
the planned subsidiaries.

The four corporations are National Power Corp. of Britain, EDF
Power Corp. of France, and two companies of the United States, he
said.

Shares

PLN's director of finance, Djiteng Marsudi, said all of the
firms have given assurances that they will be able to prepare the
planned subsidiaries for the selling of part of their shares to
the public through the country's stock market in two years.

The four companies are also offering technical assistance and
the transfer of technology to PLN subsidiaries, he told The
Jakarta Post.

Both Djiteng and Zuhal declined to give details of the
authorized and paid-up capital of the planned subsidiaries, as
well as the possible stake of foreign partners in the
subsidiaries.

"Please wait until we complete our financial reports in March
next year and after we sell some of our assets," Djiteng said.

He added that PLN has now sold a number of its assets worth Rp
1 trillion (US$459.55 million) to third parties. By March, PLN
will have completed the inventory of its assets and disbursed
them to PLN as the holding company and its subsidiaries.

Zuhal said that after the operation of two subsidiaries, PLN
will set up another subsidiary which will be responsible for
electricity distribution and transmission.

PLN, now operating power plants with a total capacity of
12,000 megawatts (MW) and 11,000-kilometer transmission networks,
plans to set up more power plants with a combined capacity of
13,000 MB in the coming five years. (fhp)