Govt to sell more stakes in Telkom and Indosat
Govt to sell more stakes in Telkom and Indosat
TOKYO (Dow Jones): Indonesian Investment and State Enterprise
Minister Laksamana Sukardi reiterated on Tuesday his target to
privatize government stakes in PT Telekomunikasi Indonesia (PT
Telkom) and PT Indonesia Satellite Corp. (Indosat) by the end of
the year.
"We are planning for an accelerated privatization of Indosat
and Telkom Indonesia," said Laksamana at a Tokyo press
conference, without indicating a specific date.
In the case of Telkom, he said that rapid technological
developments in the telecommunications field made it imperative
to sell it quickly before its equipment became obsolete.
"If we don't sell it now, it will become obsolete," he said.
He reiterated that the sales also depended on market
conditions and that the financial base of the companies need
strengthening to make them more attractive. Cross border tie-ups
were also needed and both sales required consultation with
parliament, he added.
Telkom and Indosat are two of the most attractive assets on
the government for-sale list. Both blue chips are listed in New
York and both feature prominently in foreign investor's Jakarta
portfolios.
The previous government already pushed through a sale of
around 9.6 percent of Telkom last year, raising around $404
million in the process. The government will begin deregulating
the telecoms market in 2004.
From the privatization of state-owned companies, Laksamana
said that he "didn't see a problem" in the government raising its
target of Rp 8 trillion for the 2000 budget.
In Tokyo to drum up Japanese investment in Indonesia, the
minister said investors ought to look at the long-term potential
of the large market and where the nation has come from instead of
the daily headlines.
"Were going to handle the problems. These are the consequences
of a major transformation," Laksamana said, noting that most
Western governments don't change their structure, but merely
change the party in power.
"We're not only changing the flavor of the government, but the
recipe, the cook and even the structure of the kitchen."