Indosat plans to sell its Cambodian unit

Indosat plans to sell its Cambodian unit

Publicly-listed telecommunications company PT Indosat plans to sell its 49 percent stake in Cambodian Indosat Telecommunications SA, or Camintel, a company official said on Monday.

The government of Cambodia has the remaining 51 percent stake.

"We are offering the entire stake in the unit, and hope that the sale can be completed this year," Indosat's spokesman Wahid Sutopo said.

He said the company had not yet received any bids for the unit.

Indosat has been trying to focus its business on telecommunication after it merged its two cellular units PT Satelindo and PT Indosat Mobile Multi Media (IM3) last year into the main body of the company. The company also integrates its telecommunications operator PT Bimagraha Telekomindo. The integration process is scheduled to be concluded in 2005.

Indosat president Widya Purnama told the press last week that the company planned to sell its 97 percent stake in an information technology unit PT Sisindosat Lintasbuana.

Wahid did not say how much the company expected to raise from the sale of the stakes in the two units.

Analysts said the sale of the two units was not significant to Indosat's performance due to the low valuation of the units.

Singapore Technologies Telemedia has a 42 percent stake in Indosat, Indonesia's second largest telecommunications company.

Analysts said the merger and the planned sale of some units were part of Indosat's efforts to catch up with its arch rival, PT Telkom particularly in the cellular business.

They said Indosat was lagging behind in developing its cellular business because of its huge debt, which prevented the company from allocating adequate investment for its telecommunication facilities.

Indosat is also facing increased competitive pressure with the entry of Telkom into its international direct dialing market. -- Dow Jones