Mexico's Cemex preferred bidder for Semen Gresik
JAKARTA (JP): The government has selected Mexico's Cemex SA de CV as the preferred bidder to purchase part of the government's 65 percent stake in publicly listed cement producer PT Semen Gresik.
A deputy to the state minister of the empowerment of state enterprises, Sofyan A. Djalil, said yesterday that Cemex offered to acquire 35 percent of Semen Gresik from the government for US$287 million or $1.38 per share.
"Cemex is offering a 127 percent premium on Semen Gresik's closing price on Wednesday and 226 percent higher than its weighted average price for the last six month," he told the media yesterday.
Semen Gresik's stock price stood at Rp 9,150 (63 U.S. cents) when it was suspended on Wednesday.
Although Cemex won the first stage of the tender for Semen Gresik after beating Switzerland's Holderbank Financiere Glarus, Sofyan said other bidders, including Holderbank, would be invited to submit proposals within one month, starting Monday, to top Cemex's bid.
"But if no other bidders top Cemex's bid within 30 days, Cemex will be the winner," he said, adding that Cemex would also be given an opportunity to increase its offer to top any new bids.
He said that if Cemex won the deal in the next 30 days, it would seek to buy another 16 percent stake of Semen Gresik's shares through a tender offer at a price of $1.38 per share on the local bourse.
This would give the Mexican cement maker 51 percent of the country's largest cement maker.
"The proposal on the tender offer will be submitted to Bapepam (the Capital Market Supervisory Agency) on Tuesday," he said.
Conditional
Sofyan said the Indonesian government had an option to sell its remaining 30 percent stake in Semen Gresik to Cemex in the next five years at the same price of $1.38 per share, plus an annual premium of 8.2 percent.
Sofyan said that Minister of Finance Bambang Subianto signed the conditional sale and purchase agreement with Cemex earlier yesterday.
Another deputy to the state minister of the empowerment of state enterprises, Herwidayatmo, said the agreement would require Cemex to pay the government a supplementary amount of up to $129 million in 2006 for the 35 percent stake it was bidding for now if the actual performance of Semen Gresik surpassed expectations.
He said Cemex had committed itself to investing $750 million until 2006, including an early investment worth $50 million to strengthen Semen Gresik's capital in the first year of entrance.
Javier V. Bafarull, president of Cemex Asia PTE Ltd, a subsidiary of Cemex SA for the Asia Pacific region, said Cemex had pledged to invest a total of $4 billion in Semen Gresik over the next 30 years.
Such a huge planned investment was aimed at increasing Semen Gresik's production capacity to 40 million metric tons per year in 2015 from 12.7 million tons at present, Bafarull said.
"Our long-term target is to keep the 40 percent market share in the domestic market and maintain a growth rate of between 6 percent and 9 percent per annum," he said.
Cemex, founded in 1906, produces a total of 51 million tons of cement per year from its operations in Mexico, Spain, Venezuela, Panama and the Dominican Republic.
Semen Gresik is one of 12 state-owned companies to be privatized by the government in an effort to raise about $1.5 billion in fresh funds to help lift the country out of its dire economic condition.
Semen Gresik has been in the spotlight in recent weeks after its stock price shot up more than 50 percent since early May to June 18, prompting Bapepam to set up an investigation to probe alleged insider trading in the company's stocks. The investigation is still ongoing. (aly)