Lippo Karawaci going public after delay
Lippo Karawaci going public after delay
JAKARTA (JP): PT Lippo Karawaci, a township developer in
Tangerang, West Java, is finally to sell 30.8 million new shares
or around 8 percent of its enlarged stocks to the public early
next month after a year of delay.
Lippo Karawaci's president, Eddy Sindoro, said yesterday the
company expected to raise around Rp 170 billion (US$76.5 million)
in fresh funds from the public offering.
Eddy was optimistic that the public offering would receive a
positive response from both local and foreign investors, despite
the delay.
"The plan to go public was delayed only due to unfavorable
market conditions. We hope this time things are more promising,"
he told securities analysts at a presentation of the company's
initial offering.
The Lippo Group has been reported to be suffering financial
difficulties with Lippo Land, the group's property arm which owns
Lippo Karawaci, and Lippo Cikarang, a township development in
Cikarang, West Java.
The financial problems were allegedly the result of poor
marketing of the two townships. But this allegation was flatly
denied by the business group.
Yesterday, the organizer of the presentation meeting allowed
only a couple of journalists to attend the meeting, saying that
the auditorium was already full. The organizer promised to
arrange a press conference for the journalists in the afternoon
but it was later cancelled for no clear reason.
Eddy said that a number of high-rise buildings, luxury
housings, hotels, a modern shopping complex, a golf course, a
world-class hospital and an educational center meeting
international standards had been built in the 500-hectare
integrated township in Karawaci.
"Big domestic and foreign retailers such as SuperMall, Wal-
Mart, and JC Penney have stores in the township's business
center," he added.
Eddy said that sales were very encouraging, with over 3,000
luxury houses having been sold since the launching of the project
in April 1993.
"Bank Lippo and a number of companies under the Lippo Group
have relocated their headquarters to Karawaci," he said, adding
that the country's giant retailer Matahari and a number of other
local business groups, including Dynaplast and Anwar Sierad, were
also constructing offices there, around 30 minutes from the
Tomang overpass in West Jakarta.
Eddy said that Lippo Karawaci, which will be the seventh
member of the Lippo Group to be listed on the Jakarta and
Surabaya stock exchanges, booked sales revenues of Rp 227.9
billion ($126.31 million) for the financial year ending in June
1995. The sales revenues were Rp 137.5 billion the year before.
After-tax profits rose to Rp 70.6 billion in 1994/95 from Rp
22.2 billion in the same period, he said, adding that sales
turnover and net profits for the current financial year were
projected to reach Rp 470.9 billion and Rp 100.5 billion
respectively.
He said that 40 percent of the proceeds raised from the sales
of the shares to the public would be used to construct
infrastructure and public utilities, 20 percent would go on land
clearance and the remaining 20 percent would help to strengthen
the company's capital. (hen)