IBRA signs agreement with Astra management

IBRA signs agreement with Astra management

JAKARTA (JP): The Indonesian Bank Restructuring Agency (IBRA)
has signed a confidentiality agreement with the management of
auto manufacturer PT Astra International to allow bidders access
to complete a timely due diligence of the company.

Agency chairman Cacuk Sudarijanto said on Thursday the
agreement demonstrated the support of Astra's management for the
sale of IBRA's 40 percent stake in the publicly listed automotive
company.

"We reached this agreement to accelerate the tender process
for Astra," Cacuk said during a media conference.

IBRA announced on Wednesday it had appointed three consortiums
to compete for the Astra stake. They are Singapore auto
distributor Cycle & Carriage Ltd. Consortium, with partners
Batavia Investment Management and JP Morgan International
Capital; the American consortium of Gilbert Global Equity
Partners, Newbridge Asia II, Chase Asia Equity and Saratoga
Investama Sedaya; and the Lazard Consortium from France.

Cacuk said the three consortiums would eventually sign an
agreement with the Astra management.

He said the due diligence process would begin on Monday and
was expected to be completed on March 17.

Under the confidentiality agreement, any bidders appointed by
IBRA to conduct a due diligence are prohibited from leaking any
information on Astra, Cacuk said.

IBRA's earlier attempt to sell its Astra stake to preferred
bidder Gilbert and Newbridge was unsuccessful due to reported
efforts by the previous Astra management, led by then president
Rini Soewandi, to prevent the consortium from conducting a due
diligence.

After a months-long standoff, IBRA unseated Rini earlier this
month, replacing her with Theodore P. Rachmat.

Astra is one of IBRA's prime assets to be sold to investors in
a bid to raise Rp 17 trillion to help finance the current state
budget ending on March 31. The agency expects to raise at least
Rp 3 trillion from the sale of its Astra stake.

Meanwhile, IBRA senior official Mardy Sutanto said that during
the three-week due diligence period, the three consortiums would
be given the opportunity to meet with Astra's management to
discuss the company's business plans.

He added that the consortiums also would be given access to
Astra's facilities.

Mardy said the three consortiums were expected to submit their
final bids on March 23 at no later than 5 p.m. He said IBRA would
select the winning bid on March 25.

Asked whether three weeks was a sufficient amount of time for
the prospective investors to complete a due diligence, Mardy
said: "We're optimistic, particularly with the help of the Astra
management."

Cacuk said the agency would select the bid which offered the
highest price for the stake.

There have been rumors the government favored the Gilbert and
Newbridge consortium because it includes Saratoga Investama, a
company owned by Edwin Soeryadjaja, son of Astra founder William
Soeryadjaja.

The Soeryadjaja family was forced out of Astra in 1992
following a controversial deal that put control of Astra in the
hands of several conglomerates close to former president
Soeharto.

These conglomerates later surrendered their shares in Astra to
IBRA to repay their debts to the government.

The Soeryadjaja family is known to be close with President
Abdurrahman Wahid. (rei)