Indofarma to sell 29% stake to investors

JAKARTA (JP): State-owned pharmaceutical company PT Indofarma plans to sell an additional 29 percent of its shares to strategic investors as part of the government's divestment program.

Indofarma president Gunawan Pranoto said here on Tuesday investors from Singapore, the Netherlands and Australia had expressed an interest in purchasing the government's stake in the company.

He said the sale was part of the government's plan to divest up to 49 percent of its stake in the company, which produces over-the-counter pharmaceutical products and clinical equipment. Since June 2000, the company has expanded into the baby food market.

"We are awaiting further developments in the market. We hope it (the market) improves," Gunawan said after witnessing the listing of the company's shares on the Jakarta Stock Exchange (JSX).

The pharmaceutical company became the first state-owned company this year to sell its shares to the public. In an initial public offering (IPO) late last month, in addition to selling new shares, the company also sold about 20 percent of the government's stake.

The company's capital market debut, however, did not receive a warm response from the market. The company's shares gained Rp 5 to close the morning trade at Rp 255, from its IPO price of Rp 250. But in afternoon trade, the shares lost ground to close at Rp 245.

Indofarma is one of eight state companies slated for privatization this year. The government hopes to raise about Rp 6.5 trillion from the privatization program, to help finance the 2001 state budget deficit.

The director general of state enterprises, I Nyoman Tjager, said he was optimistic this target could be achieved.

Indofarma booked a 26 percent increase in sales in 2000 to Rp 493.4 billion, from Rp 392 billion in 1999. This year, Indofarma expects a 30-percent surge in sales.

It is also targeting Rp 130 billion in net profit this year, or an 18 percent increase from Rp 110.3 billion in 2000.

The company was founded in 1918 under the name Pabrik Obat Manggarai, before it was nationalized in 1950. Indofarma adopted its current name in 1996. (03)