Nine investors to make final bids for stake in BCA

Nine investors to make final bids for stake in BCA

Tantri Yuliandini, The Jakarta Post, Jakarta

The Indonesian Bank Restructuring Agency (IBRA) announced on
Monday it had shortlisted nine investors to join the final bid
for the government's 51 percent stake in publicly-listed Bank
Central Asia (BCA).

Indonesian Bank Restructuring Agency (IBRA) Chairman I Putu
Gede Ary Suta said the bidders were expected to submit their
final bids in the third week of December.

"The signing of the sale and purchase agreement, scheduled for
the fourth week of December, will be done in parallel with a fit
and proper test carried out by (Bank Indonesia)," he told a media
conference in Jakarta on Monday.

There had been concern earlier that the government might fail
to sell the BCA shares by the end of this year due to weak market
sentiment and previous opposition from legislators.

The BCA divestment program is one of the country's key
economic programs already agreed with the International Monetary
Fund. The proceeds from the sale would help finance the 2001
state budget deficit, which is estimated to stand at 3.7 percent
of the gross domestic product.

The shortlisted local and foreign investors are: the Malaysian
Plantation Group, represented by Andalan Artha Advisindo; Bank
Mega Consortium, represented by Bhakti Capital; Thailand's
Dynamic Choice, represented by Credit Agricole; the United
State's Farallon Capital, representing itself; the Indonesian
Batik Cooperatives Association (GKBI), Newbridge, Rifan and
Saratoga, represented by GKBI Investment; Indonesia Recovery Fund
Limited, represented by IRCL; Berca Consortium, represented by JP
Morgan Securities; a Bank Panin consortium of shareholders,
represented by Trimegah Securities.

Also shortlisted is a foreign bank that refused to be
disclosed at this time.

The nine investors were shortlisted from 15 bidders that had
joined the preliminary bids to acquire BCA, the country's largest
retail bank.

The nine were selected on the basis that they were prime banks
or financial institutions with a good reputation, formed a clear
consortium backed by banks or financial institutions with a good
reputation and had a long-term commitment to investment in
Indonesia, Ary Suta said.

The investors had also to be in sound financial condition with
a clear and reliable source of funds, not be included in the Bank
Indonesia list of bad bankers and not be affiliated directly or
indirectly with the Salim family, BCA's founding owner.

The government spent billions of dollars in bonds to bailout
and nationalize BCA in 1998 during the height of the country's
financial crisis.

The Salim family was barred from reentering the bank because
it had violated the country's legal lending limit for banks by
forcing BCA to channel most of its money into other Salim
businesses. Legislators also insisted the government keep Salim
away from BCA.

Elsewhere, Ary Suta said he was optimistic that the sale would
go ahead according to plan and that it would be finalized before
the end of the year.

Earlier reports quoted Coordinating Minister for the Economy
Dorodjatun Kuntjoro-Jakti as saying that there was a slim
likelihood of the deal going through by the end of the year due
to drawn-out talks with legislators earlier, when seeking their
approval of the sale.