Mulialand makes big cut in plans for new share offering

JAKARTA (JP): PT Mulialand has significantly cut the number of new shares it intends to issue this year from an original plan of 147 million down to 25 million.

A Mulialand executive said yesterday that the sudden move was not made to escape the trading slump on the stock markets.

"We just want to give investors a chance to get profits on the secondary market," Kusyadi Kuyono, the company's corporate secretary, said in a statement.

He said that the entire net proceeds of the issue will be used for the development and construction of Taman Anggrek Mall and Condominiums in Jakarta.

At least 50 companies plan to sell equity stocks to the public this year despite a market glut resulting from the entry of over 10 new issues in the last four months.

Sources said many companies have rescheduled their public offering plans due to the unfavorable conditions on the capital markets.

Kusyadi said the offer will give the public an opportunity to appraise the company's performance before gradually increasing their investment in Mulialand.

He explained that the big cut in the number of the offered shares will not affect investment programs and that the reduction is part of the company's long-term strategy.

"To complement the financing requirements of ongoing projects, the company will consider more appropriate financial instruments," he said.

Mulialand's original announcement on the offering said that the shares would account for around 30 percent of its enlarged shares and that the cash would be used to repay debts and to finance the development of two properties and land purchases.

The company is billed to become the second largest company on the Jakarta and Surabaya stock markets after Barito Pacific Timber.(hen)