Govt divestment in Indosat capped at 14% of total stock

JAKARTA (JP): The divestment of the government's stake in international telecommunications provider PT Indosat may be limited to only 14 percent of the company's total stock to ensure the government remains its majority position, a company official said.

The company's manager for investor relations, Budi Prasetyo, said on Friday that the Indonesian government, which currently holds a 65 percent stake in the firm, should retain its position as a majority shareholder.

The divestment program was currently at the pre-qualification for tender stage, he said but declined to mention details of the company's divestment plan.

"We do not know any names of our strategic partners yet,' he said.

He said that the company's financial advisors, Danareksa Sekuritas, Bahana Securities and Goldman Sachs are working on a divestment program.

He said that if the winner of the bidding wanted to control more than 14 percent it should buy the shares through a tender mechanism in the open market.

Indosat is one of the 12 state-owned companies due to be privatized this fiscal year to raise a total of US$1.5 billion to help finance the country's state budget deficit.

Mexican cement producer Cemex SA recently won the bidding for a 14 percent stake in the country's largest cement producer PT Semen Gresik as part of the government privatization program for the 1998/99 fiscal year.

The Mexican company, which bought the Semen Gresik shares for US$1.38 per share, plans to purchase more from the market to increase its shareholding to 25 percent.

Other state-owned firms on the list to be privatized include mining companies PT Tambang Timah and PT Aneka Tambang. (aly)