Govt to issue ruling on mergers

JAKARTA (JP): The government will issue a ruling on acquisitions, mergers, divestment, joint ventures, restructuring, break-ups and joint operations, the minister of justice, Oetojo Oesman, said yesterday.

Oetojo said "we have to follow the strong current of economic changes if we don't want to miss opportunities arising from burgeoning free trade," Oetojo was quoted by Antara as saying.

The draft ruling was being processed by a special team, comprising Ministry of Justice and the Capital Market Supervisory Agency officials and professionals like accountants.

Oetojo said the special team was open to input from the public.

The minister said the new ruling would bridge the differences between the 1995 Limited Liability and Capital Market laws.

Both laws govern acquisitions and mergers but there are some differences.

The limited liability law lets shareholders float their shares at prevailing market prices irrespective of minority shareholders' interests.

But the capital market law requires more disclosure from publicly-listed firms to protect minority shareholders.

"In essence, the two laws have the same mission on this matter, and the new ruling will clarify this," Oetojo said.

The chairman of the Capital Market Supervisory Agency, I Putu Gede Ary Suta, said the new ruling would provide legal certainty and encourage business activity.

Putu said publicly-listed companies should pursue acquisitions and mergers only to improve efficiency and market value. (rid)