Hay Group named as Indosat consultant

Hay Group named as Indosat consultant

Dow Jones, Jakarta

State-owned telecommunications company PT Indosat
said on Monday it has named U.S. company Hay Group Ltd. as its
strategic management consultant.

Indosat plans to change its focus from overseas and domestic
fixed-line services to cellular services. Indosat's chief
executive Widya Purnama said Hay Group will advise Indosat in
this transformation process.

Indosat indicated its intended change of focus soon after it
took over cellular unit PT Satelindo, in the middle of last year.

Purnama said Indosat expects the change of focus to enhance
its fundamental value, strengthen its financial structure, and
improve its competitiveness in cellular business and efficiency
in capital expenditure.

As part of the move, Indosat also plans to merge its two
cellular units Satelindo and Indosat Mobile Multimedia, or IM3.

Indosat is 42 percent owned by Singapore Technologies
Telemedia Pte. Ltd., a subsidiary of Singapore Technologies Ltd,
and the Indonesian government holds a 15 percent stake.

The company said it expects its cellular phone subscription
rate to rise to 4.5 million this year from 3.6 million last year.

Only 3 percent of Indonesia's 200 million population currently
use a mobile phone. Analysts expect the number of Indonesian
cellular phone subscribers to nearly double to 21 million in 2004
from 11 million last year.

Indosat said it will name financial and legal advisers to
support the transformation of the company soon, but didn't say
exactly when.