Pelindo III to sell subsidiaries next year

Rendi A. Witular The Jakarta Post Jakarta

State-owned seaport operator PT Pelabuhan Indonesia III (Pelindo III) plans to sell three of its subsidiaries next year as part of efforts to raise cash to help finance the expansion of its ports, a senior official said.

Pelindo III president Bambang Darwoto said recently that the divestment program would also include a further sale of stakes in container terminal operator PT Terminal Petikemas Surabaya (TPS).

"We are planning to sell three of our subsidiaries next year and continue the divestment of TPS. This decision was made so that we can finance the expansion of our ports facilities," said Bambang. The ports are located on several islands throughout the country.

He said the three subsidiaries ready for sale were stevedoring service company PT Berlian Jasa Terminal Indonesia, maintenance company PT Portek Indonesia and hospital PT Rumah Sakit Pelabuhan Surabaya (RSPS).

Of the three companies, Berlian is scheduled to be divested first in the early part of next year via a private placement scheme, he said.

Bambang said that Pelindo III would also apply the same scheme to divest RSPS in mid 2004. As for Portek, the company was considering an initial public offering scheme later at the end of 2004.

Bambang, however, refused to disclose the expected proceeds from the divestment program, but a source at Pelindo III said that the company was expected to rake in more than Rp 300 billion (US$35 million) in cash.

Regarding the further sale of a stake in TPS, Bambang said that the company was still discussing the matter with the State Ministry of the State Enterprises on the amount of shares to be sold and the selling method.

"We are still discussing the amount of shares to be sold. The result is expected to come out early next year," he said.

Pelindo III still owns 51 percent of the shares in TPS, after it sold 49 percent of its stake to P&O Ports, a division of P&O Australia Ltd., for $173 million back in 1999.

TPS is located in Indonesia's second largest port Tanjung Perak Port, in Surabaya. The terminal has a capacity of over 2 million twelve-foot equivalent units (TEUs).

Elsewhere, Bambang also said that Pelindo III was considering an issue of bonds after the general election next year to help support the expansion program. However, he refused to hint at the amount of bonds to be issued.

Pelindo III, which is headquartered in Indonesia's second largest city Surabaya and operates 37 seaports, including those in Central Java, East Java, Bali, West Nusa Tenggara, East Nusa Tenggara, South Kalimantan and Central Kalimantan.

Pelindo III has projected its net profit for 2003 to decline by 14 percent on lower trading activities and higher operational costs. The company projects a profit of Rp 307 billion, down from Rp 358 billion last year.

Revenue from operations is expected to drop by 40 percent to Rp 809 billion from Rp 1.35 trillion last year.