IBRA announces sale of seven Salim oleochemical firms

JAKARTA (JP): The Indonesian Bank Restructuring Agency (IBRA) announced on Wednesday that it would sell seven oleochemical companies pledged by the Salim Group conglomerate.

Head of IBRA asset management investment division Thomas Lembong said that companies would be sold in one package through a two-stage bidding process which was expected to be completed before the end of this year.

Speaking at a press conference, Thomas said that the invitation to bid would be sent immediately to prospective investors.

He said that Chase JF had been appointed in July to lead the selling process.

The Salim oleochemicals group is one of the largest producers of natural fatty alcohol in the world, and the second largest in Asia.

The group's overall production capacity is 90,000 metric tons per year of natural fatty alcohol, a raw material used in the production of a wide range of chemical products such as soaps, shampoos, detergents, cosmetics, lubricants, paints, coatings, and food additives.

The group's headquarters is in Singapore with projects located in Belawan (Medan), Singapore, on Batam Island and in Germany.

The group's products are sold worldwide through Salim Oleochemicals (Singapore) Pte. Ltd., Salim Oleochemicals GmbH (Germany), and Salim Oleochemicals Inc. (USA).

Thomas said that under the two-stage bidding process, interested parties were requested to submit their preliminary bids for further selection before they were allowed to enter the due diligence stage.

He added that the winner would be decided before the end of this year after all final bids had been received.

The Salim Group pledged ownership of some 100 companies to repay its Bank Central Asia (BCA) obligations to the government.

IBRA is targeted to raise some Rp 18.9 trillion (US$2.28 billion) in cash this year to help finance the current 2000 state budget. So far, the agency has only raised around Rp 7.9 trillion.

The agency plans to raise around Rp 5 trillion this year from the sale of companies pledged by the Salim Group.

In addition to the oleochemicals group, IBRA is now in the process of selling other Salim assets, including the Wisma BCA office building, mining company PT Karimun Granite, and the Mosquito Coil Group.

IBRA has recently sold a 6.1 percent stake in Salim's Hong Kong-based First Pacific investment company, raising around Rp 420 billion. (rei)