IBRA to name winning bidder for BCA shares
IBRA to name winning bidder for BCA shares
JAKARTA (JP): The Indonesian Bank Restructuring Agency (IBRA)
will name the winning bidder for its stake in the publicly listed
Bank Central Asia (BCA) next week, agency deputy chairwoman Felia
Salim said on Tuesday.
"We'll name the winner between June 25 and June 28," Felia
said following a meeting with Finance Minister Rizal Ramli.
She said that there were seven bidders competing to purchase
the BCA shares.
"We're on schedule to complete the divestment of the BCA
shares soon," she added. Felia declined to provide further
details, including the size of shares to be sold by the agency.
The agency said late last month that there were 10 local and
foreign institutional investors which had submitted bids for BCA
shares.
The government nationalized BCA, the country's largest private
bank, in 1998 in the aftermath of the devastating financial
crisis. The government divested a 22.5 percent stake in BCA in
May last year through an initial public offering (IPO).
The government was supposed to have further divested a
majority stake in BCA late last year as part of an agreement with
the International Monetary Fund, which is providing a
multibillion dollar bail out loan to the country, but it was
delayed due to the unfavorable market conditions at the time.
The delay had irked the IMF, prompting it to also delay the
disbursement of its third loan tranche to the country.
The government has planned to divest another 40 percent stake
in BCA this year. But the House insisted that the second
divestment must be conducted via a combination of a private
placement mechanism and secondary public offering.
Felia said last month that the agency was considering selling
up to 30 percent shares in BCA to a strategic investor and the
remaining 10 percent through secondary offering.
The House has also demanded that the former owner of BCA, the
Salim Group, must not be allowed to reenter BCA by purchasing the
bank's shares from IBRA.
The government via IBRA is also required to divest some 51
percent shares in the publicly listed Bank Niaga, which was also
nationalized following the financial crisis.
IBRA plans to complete the Bank Niaga sale, entirely through
strategic sales, some time in October.
IBRA is mandated to raise some Rp 27 trillion in cash this
year to help finance the 2001 state budget deficit. So far the
agency has managed to only raise just over Rp 7 trillion.
The proceeds from the share sales of BCA and Bank Niaga would
contribute to the IBRA cash target.
There has been concern that amid current political
uncertainty, the agency might not be able to meet the cash
target, putting the 2001 state budget at risk.
The agency's asset sale program has also been undermined by
massive political interference.
IBRA's recent deal with Malaysia's Kumpulan Guthrie Bhd, which
had agreed to purchase palm oil plantations from the agency,
nearly collapsed after some legislators protested the deal citing
national interests.
Only after high level lobbying and protracted negotiations,
did the deal go through.(rei)