Government plans to sell another 8% in Telkom

Government plans to sell another 8% in Telkom

JAKARTA (JP): The government will sell another 8 percent of
its shares in publicly listed telecommunications company PT
Telkom, company president Muhammad Nazif said on Monday.

The newly appointed Nazif did not mention the time frame of
the divestment plan, saying the agenda would be discussed with
the Office of the State Minister of Investment and State
Enterprises Development.

"The stocks are likely to be sold through the New York and
London stock exchanges," he said after he and the president of
the other state owned telecommunications company, PT Indosat, met
with President Abdurrahman Wahid.

Nazif and Indosat president Hari Kartana reported to the
President the latest development in the country's
telecommunications sector on the forthcoming Indonesian
Telecommunications Media and Information Technology Conference
and Exhibition.

The government currently owns a 65 percent stake in Telkom
while the remaining 45 percent is owned by the investing public.

The government sold 9.62 percent of its stakes in Telkom at Rp
3,650 per share in May last year to foreign institutional
investors, in which it raised Rp 3.2 trillion, reducing its stake
in the company to the present level.

Telkom recently reported a 1999 consolidated net income of Rp
2.17 trillion, a turnaround from a net loss of Rp 1.16 trillion
in 1998.

The company currently holds a monopoly to provide domestic
fixed line telecommunications services nationwide until 2010 and
domestic long distance services until 2005.

Nazif said Telkom had not planned to increase its telephone
rates this year.

"There will be no rate increase at least until the end of this
year," he said.

Telkom, which had total assets of Rp 6.61 trillion as of
December 1999, is listed on the Jakarta, New York and London
stock exchanges.

Meanwhile, the Indosat president said his company expected to
earn Rp 2 trillion (US$253 million) in net profit this year, as
against Rp 1.37 trillion gained last year.

"In order to achieve the target, we will increase our
operating efficiency and explore the possibilities of getting a
foreign strategic partner," Hari said.

Indosat reported last week its first quarter net profit of
this year was Rp 433.8 billion, reflecting an increase of 16
percent from Rp 374.1 billion in the corresponding period last
year.

Indosat and its subsidiary PT Satelindo currently hold the
exclusive right to provide international telecommunications
services until 2004.

The company is listed on the Jakarta and Surabaya stock
exchanges, while its American Depository Shares (ADS) are listed
on the New York Stock Exchange. (prb/cst)