Government sells 8.1 percent of Indosat stake for Rp 1 trillion
Government sells 8.1 percent of Indosat stake for Rp 1 trillion
Dadan Wijaksana, The Jakarta Post, Jakarta
The government has sold some 83.5 million of its shares in
state telecommunications firm PT Indosat, or 8.1 percent of the
company's total shares, for Rp 1 trillion (US$110 million)
through a private placement scheme.
"Given the volatile market conditions, we are pleased to have
been able to successfully complete an equity offering of
Indosat," State Minister of State Enterprises Laksamana Sukardi
said in a press release over the weekend.
He did not specify who purchased the shares. Officials from
the ministry could not be reached for confirmation.
It is the year's first sale to be made by the government under
its privatization program, the proceeds of which will be partly
used to help plug this year's state budget deficit, estimated at
more than Rp 42 trillion.
Now that the first sale has been completed, Laksamana said he
was optimistic about meeting the program's revenue targets.
"The government is also on track to meet its privatization
target by the end of 2002," the state minister said.
The state budget has set a target of raising Rp 6.5 trillion
from its privatization program this year.
The sale of the 83.5 million shares reduced the government's
holding in Indosat from 65 percent to 56.9 percent.
Initially, the government intended to sell 11.32 percent of
the company, but it cut the number of offered shares in order to
achieve the best price possible.
"The offering was downsized...in order to achieve an optimal
pricing and to accommodate the proposed sale of 54.5 million new
shares from Indosat," Laksamana said.
He was referring to the number of new shares Indosat plans to
issue to raise $325 million in cash for its acquisition of German
firm Deutsche Telekom's 25 percent stake in cellular firm
Satelindo.
Following the acquisition, Indosat will wholly own Satelindo.
Indosat's shares are currently priced at Rp 12,000, compared
to its last price of Rp 12,600 when trade on Indosat on the
Jakarta Stock Exchange (JSX) was suspended on Thursday.
"But the price reflects a 1.3 percent premium to the three-
month volume weighted average trading price," Laksamana said.
The JSX suspended trade on Indosat on Thursday right after the
government announced its plan to sell off 11.32 percent of
Indosat's shares.
It is not clear when the trading will resume, but with the
completion of the sale it is likely that the suspension will be
lifted on Monday, analysts said.
Indosat is among 25 state enterprises that are on the
government's privatization list.
The government had planned to sell 45 percent of its stake in
Indosat this year, with expected earnings of between Rp 4
trillion and Rp 5.1 trillion.