Hashim uses his own resources to buy Bank Niaga

JAKARTA (JP): Hashim Djojohadikusumo, chairman of the widely diversified Tirtamas Group, said yesterday his group would use its own cash reserves and sell some of its assets to buy 50 percent of publicly listed Bank Niaga for about Rp 756.24 billion (US$290.8 million).

"As you know our group is no longer as small as some may think. We will use both our cash reserves and proceeds from asset sales to finance the acquisition."

But Hashim refused to say which assets he would liquidate.

"It's not appropriate to disclose it right now," he said.

Hashim announced Monday that Tirtamas had reached an agreement with the Tahija family to buy their 40 percent stake in Bank Niaga and planned to buy another 10 percent through a public tender offer.

Tahija's wholly owned companies, PT Austindo Teguhjaya and Austindo Nusantara Jaya, will sell their 75.63 million shares in Bank Niaga, or about 40 percent of the bank's total 189.08 million shares, at Rp 8,000 a share.

Tirtamas will buy another 10 percent, or 18.9 million shares, through a public tender offer at the same price.

Bank Niaga is the sixth largest private bank in the country with total assets of Rp 7.9 trillion and market capitalization of Rp 1.3 trillion as of December, 1996.

President of PT Austindo Teguhjaya and Austindo Nusantara Jaya George Tahija said his family would sell their bank shares because they wanted to focus on mining and power generation.

George said Austindo was developing seven gold mining concessions and three power generation projects in the country.

Aside from Bank Niaga, Tirtamas holds equity stakes in Bank Papan Sejahtera (19.8 percent), Bank Pelita (100 percent) and Bank Kredit Asia (100 percent).

He said Tirtamas had no plans to merge the banks but would form a synergy among its banks to strengthen Tirtamas' position in the financial sector before the coming free trade era.

Hashim said he and his father, Soemitro Djojohadikusumo -- a former minister and Indonesia's most senior economist -- would join Bank Niaga's board of commissioners.

"There will not be any changes to the board of management because it has so far been performing well," he said.

Tirtamas has five core businesses, cement, financial services, oil and petrochemicals, and international trading and agribusiness.

It has also stakes in Paiton Power Co, which is building a 1,200 Megawatt coal-fired power plant in Paiton, East Java; in the Adaro coal mining operation in South Kalimantan; and in PT Indonesia Bulk Terminal which operates a coal terminal and port in South Kalimantan.

Tirtamas is the majority shareholder in publicly listed PT Semen Cibinong, one of the largest cement producers.

In the petrochemical sector, Tirtamas is developing what is billed as Indonesia's largest integrated olefin and aromatics complex in Tuban, East Java.

Its trading arm, Tirtamas Comexindo, has a network of affiliated companies and representative offices in 18 countries with $400 million in annual turnover.

The group also operates more than 200,000 hectares of tea and oil palm plantations. (jsk)