Mexico's Cemex SA given four seats on Semen Gresik

JAKARTA (JP): A shareholder's meeting of the country's largest cementmaker PT Semen Gresik approved on Thursday a proposal to allocate four seats on the board of management to its foreign strategic partner Mexico's Cemex SA.

The Mexican cementmaker, which bought recently a 14 percent stake in the company, would have two seats on the supervisory board and two seats on the board of directors.

Semen Gresik appointed Jose Luis Saenz de Meira as vice president of the board of commissioners and Hector Medina as another member of that board.

Cemex's Henrique Thielen was named vice president while Hugo Bolio was appointed as a director.

The company named Indonesia's noted economist Anwar Nasution as chief commissioner, replacing Anang Fuad Rivai.

The company's president, Urip Timuryono, said on Thursday that the Mexican cementmaker could retain the four seats if it acquires at least 25 percent of Semen Gresik.

"If they fail to reach the 25 percent stake next year, Cemex will only be allowed to have two seats in management," he said after the meeting.

"Cemex has one year to raise its stake to 25 percent," he said.

Last month, the government approved Cemex's bid to buy a 14 percent stake of Semen Gresik for US$1.38 per share, a total of $114.6 million, as part of the country's privatization program.

The Mexican company, which bought the share from the government through competitive bidding, plans to a buy another 11 percent of Semen Gresik to increase its stake to 25 percent.

"It means that if Cemex wants to retain the four seats, it will have to buy another 5 percent on the open market," Urip said.

He said that Semen Gresik, which has a total debt of about Rp 4.8 trillion, including $202 million in foreign debts as of June this year, was projected to post a lower net profit this year.

"Our net profit will be slightly lower this year," he said, declining to give a figure projection.

He said the economic crisis, which has caused most property and construction activities to grind to a halt, posed a big problem to the company's sales this year.

He said the company, which also owns the West Sumatra-based Semen Padang and the South Sulawesi-based Semen Tonasa, expected to sell 9 million metric tons of cement this year.

"To offset the decline in consumption, we have to boost the export market," he said.

He said the company has sold about 1.2 million tons of cement to India, Bangladesh and some South American countries, including Nicaragua, as of September this year. (aly)