Lippo Karawachi reports 600% oversubscription of its IPO
JAKARTA (JP): PT Pentasena, the lead underwriter of PT Lippo Karawachi's initial public offering (IPO), announced its preliminary estimate that the offering is approximately 600% oversubscribed.
Lippo Karawachi said in a statement yesterday that the initial offering price of the shares was set at Rp 3,250 (US$1.3) a piece, representing a price earning ratio of nine times on forecast earnings for 1996 and a discount to a net asset value of 39 percent.
Lippo Karawachi is a residential and commercial-based urban development flagship of the Lippo Group.
The statement said that from the offering of 30.8 million shares, or 8 percent of the company's enlarged capital, Lippo Karawachi expects to raise fresh funds of Rp 100 billion.
During a public presentation to explain the details of the offering to the investing public last month, the company said that it expected total IPO proceeds of Rp 100 billion to Rp 170 billion.
The company also said that the IPO proceeds will be used for the construction of infrastructures and public utilities, land acquisition and repayment of obligations.
Lippo Karawachi's offering is the first on the Jakarta Stock Exchange (JSX) this year. It will list its shares on the JSX later this month.
Lonsum
Meanwhile, a plantation firm, PT London Sumatra Indonesia (Lonsum), announced yesterday that it will open its three-day initial public offering period on Monday.
The price of Lonsum's shares will be set at Rp 4,650, which will represent a price earning ratio of 11.6 times on a 1996 forecast earning of Rp 73.1 billion.
Lonsum will offer 38.8 million shares, or 19 percent of its total stocks, to raise Rp 180.42 billion in fresh funds.
The company said in a statement obtained by The Jakarta Post that 34 underwriters are involved in the share offering, led by the state-owned securities company PT Danareksa.
Lonsum will use 37 percent of the IPO proceeds to repay debts, 34 percent to finance its plantation in South Sumatra and the remaining 29 percent to strengthen its working capital.
Lonsum recently also signed a syndication of $197 million in term loan facilities.
The loan will also be used to finance the development of Lonsum's plantation in South Sumatra and is expected to cost Rp 347 billion ($148 million). It will also be used to repay part of its outstanding debts. (alo)