IBRA receives five bids for stake in Astra

IBRA receives five bids for stake in Astra

JAKARTA (JP): Chairman of the Indonesian Bank Restructuring
Agency (IBRA) Cacuk Sudarijanto said on Monday the agency had
received at least five bids for its 45 percent stake in the
publicly listed auto giant PT Astra International after it opened
fresh bidding on Friday.

Cacuk said this was a good signal as it indicated that foreign
investors were still interested in Astra despite the botched-up
deal between IBRA and an American investor group led by
Newbridge/Gilbert.

Cacuk said he was optimistic that the Astra sale could be
completed by March 25.

"There are already five bids which have landed on my table,"
he said at a televised debate.

He declined to name the investors and their price offer but
said IBRA had sent invitations to about 40 potential investors to
join in the bid for Astra.

He reaffirmed that the agency was expecting a minimum price of
about Rp 4,000 (US$0.53) per share for the Astra sale.

This, Cacuk said, was based on the price offered by Credit
Lyonnais Securities Asia (CLSA), which is advising France-based
Lazard Freres & Co., in its letter to IBRA last month.

Cacuk said IBRA could not follow up the CLSA offer at the time
because the agency was still bound to an exclusivity agreement
with the Newbridge/Gilbert consortium, which only expired on Jan.
31.

This agreement was not extended because the consortium failed
to conduct due diligence on Astra and provide a 30 percent
up-front payment.

"Now everyone is free to join in the bid. I hope Credit
Lyonnais is still interested, and I expect the price (offer) to
remain at about Rp 4,000 so that this can be the benchmark for
other investors," he said.

IBRA is expected to raise more than Rp 3 trillion from the
Astra sale in a bid to meet its target of raising Rp 17 trillion
to help finance the current state budget ending on March 31.

Cacuk said the agency had so far earned Rp 10.5 trillion from
its asset sales and loan recovery, but IBRA senior deputy
chairman Arwin Rasyid earlier said the agency had raised more
than Rp 12 trillion.

Another massive IBRA deal expected to be completed next month
is the initial public offering (IPO) of Bank Central Asia (BCA)
with the target of raising at least Rp 3 trillion.

Cacuk said the Astra deal must be completed before the March
25 deadline, not only because it was important to meet the Rp 17
trillion revenue target for the state budget but because a smooth
transaction would send a strong signal to foreign investors that
the government was serious about its plans to dispose of bank
assets controlled by the agency.

IBRA has been criticized by both investors and the
International Monetary Fund (IMF) for being too slow in disposing
of its assets, estimated at around Rp 600 trillion (book value).

"Our mandate is to expedite the sale process, but not through
fire sales," said Cacuk, who was appointed IBRA chairman early
last month.

Cacuk also reaffirmed the agency's determination to change
Astra's management at a shareholders meeting on Tuesday.

IBRA has accused the Rini Soewandi-led management team of
obstructing the Astra sale process with the Newbridge/Gilbert
consortium.

Separately, Rini reiterated on Monday that Astra's management
did not have any intention of obstructing IBRA's efforts in
selling its Astra stake, nor did it seek to block foreign
investors entering the company, as implied in some newspaper
reports.

"Our only concern is that the transaction be done
transparently and fairly, according to securities market
regulations and good governance practices," Rini told a crowded
news conference.

At the conference, the Astra chief executive released copies
of a letter she earlier sent to President Abddurrahman Wahid, who
is now on an overseas visit, where she clarified the controversy
over the allegation that she had deliberately obstructed IBRA's
deal with an American investor consortium led by Newbridge
Capital and Gilbert Global Equity Partners.

"What we are opposed to is the nontransparent manner in which
IBRA appointed Newbridge/Gilbert as the preferred bidder," Rini
added.

The consortium complained that it wasn't able to conduct due
diligence on Astra and to meet the deadline for concluding a
definitive agreement because of a completely uncooperative
attitude on the part of Astra's management.

Frustrated by this process, IBRA asked in early December for
an extraordinary meeting of Astra's shareholders on Feb. 8 and
proposed a replacement of management.

IBRA is accepting bids from interested investors up to Feb.
23, when it will publish a shortlist. A week later, those on the
shortlist will have the opportunity to conduct due diligence on
the company, and must place final bids by March 20.

The successful bidder will be announced on March 25. (rei)