Govt collects Rp2.68t from Danamon sale

Govt collects Rp2.68t from Danamon sale

The Jakarta Post, Jakarta

The government raised Rp 2.68 trillion (about US$274 million) on
Wednesday from the sale of its remaining 10.5 percent stake in
Bank Danamon, the country's fifth largest lender by assets.

Using a market placement mechanism, the offering was 1.36
times oversubscribed, said M. Syahrial, the head of the Asset
Management Company (PPA) -- a state agency that manages and sells
state assets, including the government's stakes in banks -- in a
statement.

The shares were priced at Rp 520 each, Syahrial added.

Earlier in the day, Minister of Finance Jusuf Anwar said the
government was expecting to raise some Rp 2 trillion from the
sale.

Jusuf said the government decided to sell its remaining shares
in Danamon through a market placement based on the bank's strong
share prices.

Danamon is currently controlled by Germany's Deutsche Bank and
Singapore's state-owned investment company Temasek Holdings,
which in June 2003 paid Rp 3.08 trillion for a 51 percent stake
in Danamon.

The government took over Danamon from former owner Usman
Atmadjaja, after injecting Rp 12.5 trillion into the bank to save
it from insolvency during the 1997 Asian financial crisis.

Danamon has posted strong financial numbers of late, including
a rise in its net interest income during the first six months of
the year to Rp 2.43 trillion, from Rp 2.15 trillion in the same
period last year.

Trade in Danamon's shares was suspended during the offering.

Shares of Danamon have gained 21 percent this year -- higher
than the market index gain of 19 percent -- but dropped 2.75
percent to Rp 5,300 in Tuesday's trading.

Jusuf said the government would use the proceeds from the
Danamon sale to help plug the budget deficit, which is expected
to reach some Rp 26 trillion this year.

The government also plans to sell its shares in other banks by
the end of the year, Jusuf said, including those in Bank Central
Asia (BCA).

"We will also offer our 5 percent stake in BCA, hopefully
within this year," he said.

Indonesia's second largest lender, BCA is 51.2 percent owned
by U.S.-based Farallon Capital Management. The government
canceled a sale of BCA shares in March after bids from potential
buyers failed to meet expectations.

Aside from the BCA sale, the government has also secured
approval from the House of Representatives to sell its minority
stake in a number of banks, notably in Bank Internasional
Indonesia (5.53 percent) and Bank Niaga (5.24 percent).

The government also hopes to sell its stakes in Bank Permata
(26.17 percent), Bank Tabungan Pensiunan Nasional (28.39
percent), MayBank Indocorp (6.08) and Bank Panin (0.0005
percent), though it has yet to get approval from the House.

For this year, the PPA hopes to raise Rp 4 trillion from the
sale of the government's shares in banks.

Excluding the Danamon sale, it has so far generated Rp 1.4
trillion in revenue.