Foreign firms bid for container terminal operator
JAKARTA (JP): Four foreign port operators have submitted bids for a 49 percent stake in a state-owned container terminal operator in Surabaya, the country's second largest commercial center, according to a senior government official.
Assistant to the State Minister of the Empowerment of State Enterprises Tanri Abeng, Herwidayatmo, said on Monday the winner would take a stake in newly established PT Terminal Peti Kemas Surabaya, a full subsidiary of the state-owned port management company PT Pelindo III, for a 20-year concession.
The results should be announced "if not this week, next week", he told reporters at a coffee morning gathering.
The firms are Stevedoring Services of America, Peninsular and Oriental Australia Ltd., International Container Terminal Services Inc. of the Philippines and France's Port of Marseille.
Herwidayatmo expected privatization proceeds would be less than that raised from the sale of a 51 percent stake in PT Jakarta International Container Terminal (JICT), a subsidiary of PT Pelindo II, to Grosbeak Ltd., a unit of Hong Kong's Hutchison Whampoa.
He added that "political reasons" were behind the government's decision not to sell a majority stake in Pelindo III's privatization program.
The government raised US$215 million in proceeds from the Pelindo II privatization last month. It was the second and final privatization deal it reached during the 1998/1999 fiscal year, from its target to privatize 10 companies.
Several legislators expressed concern earlier that the Pelindo II privatization program was not transparent, and the government received a low price for the sale.
Tanri dismissed the allegations on Monday.
Stressing the privatization was conducted in a transparent way, he said the limited disclosure during the bidding process was a necessary condition because the bidders were publicly listed companies.
He termed it a "good price" considering the current political and economic uncertainty.
Tanri said JICT was sold at a price earning ratio (PER) of 13 times 1999 earnings, which is higher than the 1999 PER average of 12.8 times of the foreign terminal container operators.
"The sale of JICT was even higher than that made by Grosbeak for a 50 percent stake in Rotterdam Port." He said Grosbeak bid $180 million for the Dutch port, which has twice JICT's capacity.
Earnings
He explained JICT's privatization would boost its earnings to at least $992 million, compared to only $725 million without the privatization program, because the company could increase its capacity from 1.6 million TEUs to 3.15 million TEUs.
He added that JICT would also benefit from Hutchison's ownership in 17 port operators throughout the world, and a 10 percent share in the world's terminal container market.
Tanri dismissed rumors that Grosbeak was partly owned by Indonesian conglomerate Lippo Group.
"Grosbeak is a 100 percent subsidiary of Hong Kong listed Hutchison Whampoa. As a publicly listed company, all information is available to the public," he said. (rei)