Lippo e-Net clarification not enough: MISI executive
Lippo e-Net clarification not enough: MISI executive
JAKARTA (JP): PT Asuransi Lippo e-Net's clarification
published in Tuesday's newspapers was pointless and gave no
answer to the market confusion about the insurance company,
according to the Indonesian Securities Investors' Society (MISI).
"There is yet no clear consensus regarding Lippo e-Net," MISI
executive Johanes Soetikno told reporters on Tuesday.
Lippo e-Net, as required by the capital market watchdog,
published on Tuesday one full newspaper page clarifying
inconsistent statements previously made by the company.
"Effectively, is it really an insurance company, an Internet
company or just a holding company? Sorry, I cannot tell you,"
Johanes added.
The company announced in late January hat it had transformed
itself into an Internet company, but Tuesday's clarification
literally said the insurance company had not yet changed its core
business which was currently an insurance business.
"Lippo e-net has not changed its business status. The company
plans to hold a shareholders meeting in June, 2000 to approve the
company's change of business," said Tuesday's clarification.
The company is still an insurance company and still directly
manages the insurance premium proceeds, according to the
clarification published in papers on Tuesday.
The listed insurance company said it had transferred over 99
percent of its premium proceeds to its non-listed affiliate, thus
still managing less than one percent of the proceeds directly.
Johanes said Tuesday's clarification was just a means used by
Lippo e-Net to look for justifications to erase its past sins by
simply making modified, or even new, statements to the public.
Johanes said Lippo e-Net announced in early January it would
immediately invest at least Rp 1 trillion in the Internet
business.
But with the clarification the company modified the statement
by stating that the disbursement of the Rp 1 trillion fund is
gradual and conditional to the controlling circumstances and
other developments which may arise over time.
As reported earlier, the Lippo e-Net share price doubled
within a week following the company's Rp 1 trillion commitment
announcement in January.
The share price in January surged from Rp 450 at the
announcement to Rp 950 a week later in a very high transaction
volume.
The peak price then went down consistently.
On Tuesday it was down by Rp 25 to close at Rp 300.
"Lippo e-Net has done damage to public investors by making
misleading statements. The capital market watchdog should have
imposed sanctions by now," Johanes said.
He said that a lot of public investors jumped on the
bandwagon, being attracted by the increasing price of Lippo e-Net
shares in January.
But the public investors were amazed and sold back their Lippo
e-Net shares at a great loss upon learning that the company's
Internet dream was actually premature, according to Johanes.
He said that requiring Lippo e-Net to announce another set of
statements would mean granting the company a chance to excuse
itself once again.
"Lippo e-Net was making vague statements that it could easily
invite public misinterpretation. And such misinterpretation is
always to the advantage of the company," he added.
Lippo e-Net in its Tuesday clarification stressed the company
would be primarily an insurance business until the changes were
approved at the next shareholders meeting in June.
The clarification also stated that Lippo e-Net would hand over
its insurance business permit back to the government after it
officially changed its business status, and then eventually
transfer all the remaining insurance premium proceeds out of the
company portfolio.
"The company also plans to drop the word 'Asuransi' in the
future from its current official name -- PT Asuransi Lippo e-
Net," the clarification said.
Lippo e-Net is listed on the Jakarta Stock Exchange. It
changed its name in late January from PT Lippo Life to PT
Asuransi Lippo e-Net. (udi)