Govt undecided over SG saga
Rendi A. Witular, The Jakarta Post, Jakarta
The government has not yet decided if it would buy back shares in publicly listed cement producer PT Semen Gresik (SG) from Mexico-based cement giant Cemex SA to resolve a protracted dispute over Cemex's investment in the state-owned company.
Coordinating Minister for the Economy Dorodjatun Kuntjoro- Jakti said a proposal by some ministers and the Gresik management for the government to reclaim its shares from Cemex had yet to be discussed or decided.
"Up to this point, we haven't discussed nor decided any out-of-court settlement options, including a decision to reclaim our shares from Cemex," Dorodjatun announced on Wednesday.
Cemex has a 25.53 percent stake in Gresik while the government has a 51.01 percent stake, with the remainder is held by private investors.
Spokesman for the Office of the Coordinating Minister for the Economy Mahendra Siregar said other ministers could propose such an option, but any decision should be approved by the privatization committee for state enterprises, which is headed by Dorodjatun.
"The committee hasn't decided on any settlement options. Other people should not claim that it has come out with a definite resolution for the case," said Mahendra.
State Minister of State Enterprises Laksamana Sukardi has previously said his office had appointed state pension fund PT Jamsostek to help reclaim the government's shares in Cemex to resolve the dispute.
Laksamana's proposal was supported by SG president director Satriyo, who recently said that a buy-back option would have less of a negative impact on the future operation of the company, and would satisfy both Cemex and the government.
The dispute between the government and Cemex, the world's third-largest cement producer, centers on the company's failure to acquire a controlling stake in SG, as stipulated in an acquisition agreement made in 1998 when the Mexican firm bought the SG shares through a government privatization program.
Attempts to resolve this problem have been unsuccessful, leaving Cemex's investment in limbo. The company has asked the International Center for the Settlement of Investment Disputes (ICSID) to act as an arbiter in its dispute with the government and SG, Indonesia's largest cement producer.