Govt may sell 25%-35% of its Sucofindo stake
Govt may sell 25%-35% of its Sucofindo stake
JAKARTA (JP): The government is considering selling 25 percent
to 35 percent of its stake in surveyor company PT Sucofindo as
part of this year's privatization program, a senior government
official said on Tuesday
Secretary to State Minister of Investment and State
Enterprises Development I Nyoman Tjager said the government would
sell the shares to foreign surveyor firm Societe Generale De
Surveillance (SGS), which currently owns 5 percent of Sucofindo.
"We haven't decided yet how much we will sell; it is clear
however that SGS does not want to remain at 5 percent," he said
on the sidelines of a hearing between the House of
Representatives and the state minister.
Nyoman declined to estimate how much in revenue the government
might reap from the sale of its shares at Sucofindo, saying no
calculations had yet been made.
The government expects to raise some Rp 6.5 trillion (US$755
million) from the privatization of 10 state companies during the
April-December 2000 fiscal year.
Nyoman said that increasing SGS participation in Sucofindo
would boost its commitment to Indonesia.
SGS, Nyoman said, was a global company and Indonesia would
benefit from the company's global network to expand Sucofindo's
services abroad.
"For SGS to give Sucofindo business opportunities, SGS wants
its portion to be raised," he said.
Sucofindo is a member of SGS and is known for its services in
export inspection, certification as well as commodity inspection
and trade facilities.
The company teamed up last month with ABX Logistics of Belgium
to provide transportation, logistics, warehousing and inspection
assessment services to Indonesian companies and their foreign
partners.
The government only recently included Sucofindo and trading
company PT Kerta Niaga among the 10 state companies earmarked for
privatization.
It initially planned to sell only eight state companies to
generate the Rp 6.5 trillion.
The government earlier acknowledged that its privatization
program in previous years had fallen short of its target.
But Nyoman has said he is optimistic that the target could be
met this year.
According to him, Sucofindo and Kerta Niaga will make up only
a small percentage of the overall proceeds from the privatization
of the 10 companies.
He dismissed calls by some House members to delay the
privatization program due to the current sluggish market
conditions.
"If we delay the privatization how are we going to get the Rp
6.5 trillion?" Nyoman asked.
Commission IX member Didik Supriyanto was pessimistic that
this year's target could be met.
"We might very well recommend the state minister delay the
privatization program or at least revise the target," he told
reporters on the sidelines of the hearing, which will be
continued on Friday.
Didik said foreign investors were still adopting a wait-and-
see stance due to prevailing political uncertainties.
He added that many of the state companies to be sold off had
yet to be restructured.
"First we must polish the goods (the state companies) and then
the timing must also be correct," he explained.
Didik said although it was his commission that initially
imposed the target of Rp 6.5 trillion, present conditions called
for adjustments.
"When we set the target back then we were hoping that the
investment climate would improve," he said.
He also said a wider deficit in this year's state budget was
acceptable if it meant saving the state companies from being sold
too cheaply. (bkm)