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)