Government to sell stake in coal giant this month
Government to sell stake in coal giant this month
The Jakarta Post, Jakarta
Despite the current uncertainties in the local financial
market, the government is pressing ahead with its plan to sell a
12.4 percent stake in coal mining giant PT Tambang Batubara Bukit
Asam (PTBA).
The sale of some 286.9 million shares through a secondary
offering by the publicly listed firm is expected to be completed
by the end of this month, according to Daniel Iskandar, a
director of PT Danareksa Sekuritas, the underwriter of the
offering.
The government and the company are planning to hold a roadshow
in a number of Southeast Asian countries, as well as Hong Kong,
from June 9 through June 11 in a bid to interest foreign
investors in the shares.
The shares are tentatively due to be listed on June 27 or June
28.
The sale of PTBA is part of the government's privatization
program for this year, which it is hoped will raise cash to help
plug the 2004 state budget deficit.
But the current upheavals in the local stock market and the
plunging value of the rupiah against the U.S. dollar has created
worries among some officials and lawmakers as to whether the
privatization program should be temporarily postponed to ensure
higher proceeds.
One senior official, in fact, has said that the government was
planning to postpone a secondary offering by the giant Bank
Mandiri.
The rupiah has weakened by around 11 percent so far this year,
making it the worst performing currency in the Asian region, due
to a combination of political uncertainty at home in the run up
to the presidential election, and a possible hike in U.S.
interest rates, which has prompted some people to switch from
rupiah-based assets to dollar-based assets. The falling rupiah
has prompted investors to sell shares on the local stock market
as the depreciation will increase the burden on companies in
repaying their overseas debts, increase the cost of importing raw
materials, and eventually create renewed inflationary pressures.
So far this year, the government has raised around Rp 3.6
trillion in privatization proceeds out of the total target of Rp
5 trillion.
Meanwhile, PTBA president Ismet Harmaini said the company was
also seeking as much as US$500 million to finance a steam driven
power plant in the Riau Islands.
"We now have around $150 million in cash, and we may raise
more funds to finance the project through issuing bonds or
seeking banks loans," he said.
He expects the project to start later this year.
Bukit Asam also plans to set aside 50 percent of its 2003 net
profit to pay a dividend, he said.
The company's net profit last year increased 18 percent to Rp
210 billion (US$22.4 million) from Rp 178 billion in 2002.
PTBA also plans to acquire a couple of coal mining firms in
East Kalimantan in the near future to help increase the company's
coal production.
The Jakarta Post, Jakarta
Despite the current uncertainties in the local financial
market, the government is pressing ahead with its plan to sell a
12.4 percent stake in coal mining giant PT Tambang Batubara Bukit
Asam (PTBA).
The sale of some 286.9 million shares through a secondary
offering by the publicly listed firm is expected to be completed
by the end of this month, according to Daniel Iskandar, a
director of PT Danareksa Sekuritas, the underwriter of the
offering.
The government and the company are planning to hold a roadshow
in a number of Southeast Asian countries, as well as Hong Kong,
from June 9 through June 11 in a bid to interest foreign
investors in the shares.
The shares are tentatively due to be listed on June 27 or June
28.
The sale of PTBA is part of the government's privatization
program for this year, which it is hoped will raise cash to help
plug the 2004 state budget deficit.
But the current upheavals in the local stock market and the
plunging value of the rupiah against the U.S. dollar has created
worries among some officials and lawmakers as to whether the
privatization program should be temporarily postponed to ensure
higher proceeds.
One senior official, in fact, has said that the government was
planning to postpone a secondary offering by the giant Bank
Mandiri.
The rupiah has weakened by around 11 percent so far this year,
making it the worst performing currency in the Asian region, due
to a combination of political uncertainty at home in the run up
to the presidential election, and a possible hike in U.S.
interest rates, which has prompted some people to switch from
rupiah-based assets to dollar-based assets. The falling rupiah
has prompted investors to sell shares on the local stock market
as the depreciation will increase the burden on companies in
repaying their overseas debts, increase the cost of importing raw
materials, and eventually create renewed inflationary pressures.
So far this year, the government has raised around Rp 3.6
trillion in privatization proceeds out of the total target of Rp
5 trillion.
Meanwhile, PTBA president Ismet Harmaini said the company was
also seeking as much as US$500 million to finance a steam driven
power plant in the Riau Islands.
"We now have around $150 million in cash, and we may raise
more funds to finance the project through issuing bonds or
seeking banks loans," he said.
He expects the project to start later this year.
Bukit Asam also plans to set aside 50 percent of its 2003 net
profit to pay a dividend, he said.
The company's net profit last year increased 18 percent to Rp
210 billion (US$22.4 million) from Rp 178 billion in 2002.
PTBA also plans to acquire a couple of coal mining firms in
East Kalimantan in the near future to help increase the company's
coal production.