Govt appoints Semen Padang president to lead SG

Govt appoints Semen Padang president to lead SG

Rendi A. Witular, The Jakarta Post, Jakarta

The government, as the majority shareholder, appointed Dwi
Soetjipto as the new president director of PT Semen Gresik, amid
plans by the country's largest cement maker to expand its
capacity and cope with threats of future cement shortages.

Dwi, who is currently the president director of Gresik's West
Sumatra-based subsidiary PT Semen Padang and has served his
entire career in the company, will replace Satriyo.

The decision was made during an extraordinary shareholders'
meeting, which ended late on Monday. The government has a 51
percent share in the company, with Mexican cement giant Cemex SA
and public investors holding 25 percent and 24 percent,
respectively.

Aside from the reshuffle, the shareholders also agreed to
retain incumbent Semen Gresik vice president director Francisco
Noriega and finance director Cholil Hasan.

New management members include Chabib Bahari, Suharto and Paul
Eugene Serrano.

The shareholders have also appointed Agus Tjahyana as
president commissioner of the company, replacing Zainal Abidin,
and retained Jose Luis Saenz de Miera Alonso as vice president
commissioner.

Purwaka, Muhammad Nuh and Jannette V. Sevilla have been
included on the list of new additions to the board of
commissioners.

A senior official at the office of the State Minister of State
Enterprises said Dwi's appointment was primarily attributable to
his success in improving Semen Padang's operation.

"Dwi has been appointed as president because he managed to
improve the performance of Semen Padang and restore the firm's
operation after the 2002 catastrophe," said the official.

Semen Padang management and workers, backed by several local
politicians, launched in 2002 a massive strike demanding a
separation from its parent company to protest the contractual
agreement by the government to sell its controlling stake in
Semen Gresik to Cemex.

Years of revolt ended when the government launched a major
shakeup in the company's management structure last year.

Elsewhere in the meeting, Cemex representatives refused to
approve Gresik's consolidated audited financial statement for
2004, due in part to several question marks in the Semen Padang
account.

Gresik vice president commissioner Jose Luis Saenz de Miera
Alonso and commissioner Ignacio Ortiz Martin said in a statement
that the uncertainties included the significant arrears in the
2002 and 2003 financial statements of Semen Padang to which
auditors issued a disclaimer opinion.

Aside from that, the findings of the special audit of Semen
Padang have not expressed any formal opinion. The audit was
launched in 2003 to uncover the reasons for the problems in Semen
Padang.

The shareholders at Tuesday's meeting also ordered the new
management of Gresik to conduct a comprehensive feasibility study
on plans to construct new plants next year in Central Java, with
an expected installed capacity of 2.5 million tons of cement
annually.

Gresik is currently utilizing all of its installed capacity of
some 6.9 million tons per year.

The company has predicted that there could likely be a
shortage in the commodity by 2007, with government-sponsored
infrastructure projects spurring demand.