Indra appointed new president of Indosat

JAKARTA (JP): Shareholders of publicly listed international telecommunications operator PT Indosat approved in a closed door meeting held on Thursday the appointment of Indra Setiawan as new company president.

Shareholders also approved during the meeting the appointment of Mochamad Hasjim Thojib as finance director to replace Herman Simandjuntak, who was removed from his job in September following a scandal involving a government dividend worth Rp 112 billion.

Indra said his priority was to rehabilitate Indosat's current tarnished image resulting from the scandal by restructuring the company's management and administration.

"From now on the management and administration of the company will be carried out in an open manner," he told a media conference after the meeting.

Indra is not an unfamiliar face at Indosat. He held a variety of roles in the company from 1982 to 1996. Before leaving Indosat to take up the post of president at state owned PT Hotel Indonesia International, Indra's last position in the company was as general manager for general affairs.

Indra will replace former president Tjahjono Soeryodibroto, who resigned last month following the removal of Herman from his job as finance director over irregularities in payment of a government dividend.

Herman delayed the government dividend payment of Rp 112 billion and temporarily transferred the funds to a bank account. He did not include the Rp 22.5 billion in interest gains from the funds when Indosat later transferred the funds to the government.

Indra said the dividend had been fully paid to the government, but refused to comment further on the scandal.

Indra and Thojib were nominated by the office of the State Minister of the Empowerment of State Enterprises to fill the vacant positions, said an Indosat executive.

There was no objection to the appointments, except from a custodian representing offshore foreign investors who hold stocks in the company. With about a 65 percent ownership stake, the government still controls the company.

"But it did not have any affect at all because the remaining shareholders supported the government's stance," the source added.

Indra said his main priority would be to maintain and improve the company's core business in anticipation of the opening of the market in the global and regional telecommunication sectors.

He said Indosat should focus on the application and mastering of world class information technology in order to boost the company's competitiveness.

Indosat's main business is providing the international direct dial service a part of its switched and non-switched telecommunications services, using primarily the submarine cable facility but also satellite transponders.

Indosat, which has at least 30 subsidiaries and affiliated companies here and overseas, has an exclusive right to provide the international direct dial service in Indonesia until 2004.

The company's operational director, Achmad Rivai, said Indosat's future business plan would put first priority on the further development of submarine cables, which has been its chief support of all products and services.

"We're also going to enter the mobile telecommunications sector. This sector is very important and a lucrative business too," he said.

Indosat currently has stakes in two local giant cellular network operators, PT Satelit Palapa Indonesia (Satelindo) and PT Telekomunikasi Selular (Telkomsel).

The company is reportedly considering selling 6.5 percent of its 7.5 percent stake in Satelindo in order to buy a stake in local cellular network operator PT Excelcomindo Pratama.

Indosat posted an unaudited consolidated net income of Rp 638.4 billion for the first half of 1999, a figure representing a 36.8 percent increase over the corresponding period in 1998.

The company's shares are listed on the Jakarta and Surabaya Stock Exchanges, while its American Depository Shares are listed on the New York Stock Exchange. (cst)