JSX to delist Texmaco units in October

JSX to delist Texmaco units in October

Rendi A. Witular, Jakarta

The Jakarta Stock Exchange (JSX) plans to delist textile
producer PT Texmaco Jaya and plastic producer PT Wahana Jaya
Perkasa, two units of the once mighty Texmaco Group, next month
as the two ailing companies are considered to be no longer able
to sustain their operations.

But the JSX will spare Texmaco's two other listed units,
engineering company PT Texmaco Perkasa Engineering and textile
company PT Polysindo Eka Perkasa, as their business operations
are likely to be sustainable.

JSX listing director Harry Wiguna told The Jakarta Post on
Wednesday that after meeting with the management of Texmaco Jaya
and Wahana last month, the bourse had come to the conclusion that
their operations could no longer be sustained.

"Of the four Texmaco companies, we have decided to delist two
of them because of chronic problems with their financial accounts
and their gloomy business prospects. Currently, we are still
processing their delisting," said Harry.

Harry explained that the delisting decision was also taken
amid uncertainty over the fate of the group's debt restructuring
talks with creditors -- both private and the government.

The Texmaco Group, which has fixed assets totaling more than
US$2 billion, owes more than $3 billion to the government and
about $1.4 billion to overseas creditors. The government has so
far failed to sell its stakes in the Texmaco units to new
investors.

The group, which was founded by an Indonesian businessman of
Indian origin, Marimutu Sinivasan, found itself mired in debt
following the Asian financial crisis of 1997, which prompted the
government to bail it out.

Harry said the Capital Market Supervisory Agency (Bapepam) had
ordered the JSX not to force Texmaco Jaya and Wahana to buy back
the shares, since the companies were currently under the control
of the government.

Buying back public shares in the two companies would only
burden the government, which has pledged not to inject more funds
into the company. Texmaco, the country's largest textile
conglomerate, said previously that it needed at least $200
million to revive its units' operations.

The public has 20.43 percent of the shares in Wahana and 8
percent in Texmaco Jaya.

"The public will not lose their shares in the two companies.
They will still have the control of the companies, but they
cannot sell their shares on the bourse. It is just a matter of a
change in status from listed to unlisted," said Harry.

The JSX suspended trading in the shares of the two companies
last year. Both companies are still operating, albeit at low
capacity.

Elsewhere, regarding the suspension of trading in the shares
of beverage company PT Ades Alfindo Putrasetia over an allegation
that it had deceived investors by overstating its sales volumes,
Harry said the JSX would not lift the suspension unless the
company violated the bourse's transparency requirements.

In a recent filing with the U.S. Securities and Exchange
Commission, Coca-Cola Co. reported that Ades, a joint venture
between Coca-Cola and food giant Nestle SA in Indonesia, had
inflated its sales volumes by between two million and 13 million
bottles every quarter since the third quarter of 2001.

"Ades has not been transparent to us and the public on the
impact of the problem on its 2003 accounts. We estimate that
these should have revealed a loss," said Harry.

The JSX decided to suspend trading in Ades shares on Aug. 5
following questionable share price fluctuations and the problems
with its sales volume.