IBRA to sell stake in iron company and subsidiary

JAKARTA (JP): The Indonesian Bank Restructuring Agency (IBRA) will sell its 97.69 percent stake in galvanized iron sheet manufacturer PT Kerismas Witikco Makmur as part of its asset disposal program to help finance the state budget.

Dasa Sutantio, director of IBRA's Asset Management Investment (AMI) unit, said here on Monday the sale would also involve Kerismas's principal debt of Rp 127.3 billion ($134 million), and the agency's 50.14 percent stake in PT Semarang Makmur.

PT Kim Eng Securities has been appointed as financial adviser for the sale of Kerismas, Dasa told a media conference.

Kerismas -- with factories in Cilincing, North Jakarta and Bitung, North Sulawesi -- produces plain and colored galvanized iron sheets, primarily for use as roofing material. It also produces construction material such as wall cladding, and floor plates for reinforcing concrete floors.

These products are marketed under the brand names of Gajah Berlian, Indolock, Perkasadek, Krisdek, and Perkasa Roof Tiles.

Semarang Makmur produces plain galvanized iron sheets under the brand name of King Elephant, Kinglock, and Kingdeck, and has a factory in Semarang, Central Java.

"The sale is open to any investors willing to buy the whole package," Dasa said, adding that a strategic sale was seen as the best way to obtain optimum value.

The sale process comprises two stages, he said, the first involving interested parties submitting their preliminary bids.

"This is to determine their seriousness in buying the company," he said.

The preliminary bids would then be followed by a due diligence phase where among other things potential buyers are taken to the company's factories for a site visit, Dasa said.

IBRA owns PT Kerismas and PT Semarang through PT Holdiko Perkasa, which was established in 1999 in connection with the debt settlement agreement between Salim Group to the government.

As part of the agreement, the Salim Group transferred shares and assets in more than 100 companies to Holdiko, which will subsequently transfer the proceeds from the sale of the assets to IBRA.

"The second stage involves the final bids by investors, after which Holdiko and IBRA will determine the winner," he said.

Dasa said the sale was expected to be concluded by the end of May this year.

Holdiko's corporate finance manager Stanley Halim said that Kerismas assets as of August 2000 were worth Rp 311 billion ($32.7 million), with equity worth Rp 115 billion.

Kerismas's total installed production capacities of plain galvanized iron sheets and colored galvanized iron sheets are 98,820 tons per year and 48,000 tons per year respectively.

The company operates at a utilization rate of more than 90 percent, he said.

As of August 2000, Kerismas recorded sales of Rp 282.3 billion and gross profit of Rp 47.6 billion, Stanley added.

Dasa said that more than 40 local and foreign investors have expressed interest in buying the stakes.

"Some interested parties came from the financial sector, but mostly are from those that have an interest in this kind of business," he said.

Holdiko director Scott Coffey said that together with IBRA, the company plans to announce an additional list of assets for disposal this year.

"Together with the sale of our stakes in Indocoal, Indomaret, Indosiar, Sulfindo, and Kerismas, Holdiko aims to raise over Rp 1 trillion from the sale of these spill-over assets," he said.(tnt)