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Mon, 15 Sep 1997

JP/Indomobil plans to merge with PT Indomulti

Indomobil plans to merge with PT Indomulti

JAKARTA (JP): The giant Salim Group plans to merge its automotive arm PT Indomobil Investment Corporation with the publicly listed firm PT Indomulti Inti Industri.

The group said Saturday the planned merger would be conducted by pooling interests with Indomulti, the surviving company.

The planned merger will automatically transform Indomobil, the country's third largest auto producer, into a public company without an initial public shares offering.

A Salim Group executive director, Benny S. Santoso, said the planned merger would improve Indomulti's shareholders value and market capitalization.

"This proves Salim Group's commitment to public shareholders," Benny said.

He added that after the merger, the Salim Group would divest more of its ownership in Indomulti to the investing public through a secondary share offering.

Before the merger, Indomulti, a multi-industry corporation listed on the Jakarta and Surabaya stock exchanges, would divest all of its businesses.

The company produces a wide range of goods, including textiles, shoes, packaging and printing products, iron sheet and mosquito coil.

If the planned merger was approved by Indomulti's independent shareholders, the group said, Indomulti would be renamed PT Indomobil Sukses Internasional and would focus on the automotive business.

Indomobil's president Soebronto Laras said his company had prepared to go public since last year so the community at large would also benefit from Indomobil's growing auto business.

Last year, the company booked a Rp 119 billion (US$41 million) net profit.

Indomobil is currently the country's third largest auto producer after publicly listed PT Astra International and PT Krama Yudha Tiga Berlian. Last year, it sold 60,000 vehicles, a drop from 70,000 in 1995.

Indomobil assembles various automobiles from Japan, South Korea and Europe. They include vehicles under the brand names of Suzuki, Hino, Mazda, Nissan, Ssangyong and Volvo. Currently, it also helps produce the national Timor sedan. (rid)