Nazif appointed new president of PT Telkom

Nazif appointed new president of PT Telkom

JAKARTA (JP): Shareholders of publicly listed
telecommunications company PT Telkom approved on Friday the
appointment of former banker Muhammad Nazif as new company
president, replacing A.A. Nasution, despite objections from some
public shareholders.

Shareholders representing 244,200 shares opposed the
appointment, but the majority shareholders with over eight
billion shares supported Nazif's appointment, which was proposed
by the government as the controlling shareholder with 66 percent
ownership of the company.

The minority shareholders questioned the capability of Nazif
to manage the state-owned domestic call operator, arguing he had
no professional experience in the telecommunications industry.

But the assistant to State Minister for Investment and State
Enterprises Development, Beny Pasaribu, who represented the
government at the shareholders meeting, insisted that
Nazif was the best choice among the seven candidates in the fit
and proper test.

"Nazif may not have any experience in the telecommunications
sector, but he is well educated and has a lot of experience in
banking management, an asset which we think will make him and the
other four directors a good management team," Pasaribu argued.

Many local telecommunications experts and Telkom's own
employees, including Nasution himself, had opposed the
government's nomination of Nazif because he had no experience in
the telecommunications sector.

Nazif was previously active in managing banks, including Bank
Bukopin, and was most recently a director of the Islamic
Development Bank. He is a lecturer at the University of Indonesia
and served as an assistant to the rector.

The other four directors are all executives of Telkom which is
listed on the Jakarta, New York and London stock exchanges.

The chief of Telkom's East Java office, Kristiono, was
appointed director of planning and technology, head of logistics
Mursyid Amal as director of finance, head of development
Komaruddin Sastrakoesoemah as director of operations and
marketing and president of Telkom's affiliate satellite
communications provider PT Lintasarta, Taufik Akbar, as director
of human resources.

Bacelius Ruru was named new chief commissioner and Noor Fuad,
Purnomo Sidhi, Andi Siswaka Faisal and Rahardjo Tjakradiningrat
as commissioners.

Nazif told a news conference after the shareholders meeting
that his priorities included preparing Telkom for fierce global
competition and to improve its financial performance.

Nazif and the new directors will serve until 2005.

The meeting also approved the payment of Rp 1.08 trillion
(US$147 million) in dividends for 1999, representing 50 percent
of Telkom's 1999 net profit of Rp 2.17 trillion, or Rp 53.87 per
share.

Telkom will allocate 49 percent, or about Rp 1.06 trillion, of
its net earnings for investment and keep the remaining 1 percent,
or Rp 21.72 billion, for cash reserves.

Telkom, which had total assets of Rp 26.3 trillion as of last
year, reported a consolidated net income of Rp 2.17 trillion, an
86 percent increase from a Rp 1.16 trillion profit in 1998.

Its debts as of December 1999 totaled Rp 9.21 trillion, about
51 percent of which was denominated in rupiah, with the remainder
in foreign currencies.

The company holds the monopoly in fixed lines for local calls
until 2010 and for domestic long distance calls until 2005. (cst)