Makindo, Dynaplast to buy back shares

JAKARTA (JP): Shareholders of publicly listed securities company Makindo and plastics components manufacturer Dynaplast approved on Tuesday plans to buy back up to 10 percent of the companies' shares from the public.

Makindo Chief Executive Gunawan Jusuf said the shareholders had approved to use Rp 118.8 billion (US$16.97 million) taken out of the company's retained earnings to buy back up to 87.7 million shares, forgoing to pay out dividends.

"After the buyback, shares held by the public will be reduced from 47 percent to 37 percent," Gunawan said.

He said that the buyback will be conducted between July 1 and July 30.

Total volume of the company's outstanding shares is 877 million, 47 percent of which are currently held by the investing public.

Gunawan also said he expected the company would book a net profit of about Rp 60 billion (about US$8.57 million) in the first half of the year, as the first quarter net profit reached Rp 30 billion.

Makindo posted a net profit of Rp 118.8 billion in 1998, a 47.3 percent increase over 1997.

Dynaplast also received approval on Tuesday from its shareholders to buy up to 10 percent of its shares through the stock exchange.

The company said that the buyback will be conducted within 18 months from Tuesday's shareholders approval.

The company said that its current share price is well below book value, thus, it thought it was the best time to buy back its shares.

From January to May, Dynaplast booked a net profit of Rp 10 billion.

The Capital Market Supervisory Agency (Bapepam) previously banned share buying back to protect the public from insider trading. But the agency later eased the ban to allow listed companies to improve their undervalued stocks.

In the buyback program, however, Bapepam only allows listed companies to buy back up to 10 percent of their total shares. (udi)