Pramindo prefers joint venture with Telkom
Pramindo prefers joint venture with Telkom
JAKARTA (JP): PT Pramindo Ikat Nusantara has proposed the
establishment of a joint venture with PT Telkom to resolve a two-
year dispute over its joint-operation agreement with the state-
owned telecommunication company.
Pramindo, a foreign joint venture contracted to install and
operate telephone lines in Sumatra on Telkom's behalf, along with
four other contractors, have demanded an increase in telephone
tariffs so as to bring them to profitability, or else have their
contracts revised.
The five have been negotiating with Telkom and several options
have been put on the table, including the possibility of forming
a joint venture arrangement with Telkom. Other alternatives
include maintaining the contracts as they are, modifying the
contracts, buyout of the contractors by Telkom, and forming joint
venture deal with PT Indosat, the smaller state-telecommunication
company.
Pramindo vice managing director Irawan Santoso said his
preference was for a joint venture with Telkom.
This, he said, was a better option than a Telkom buyout.
He added that he did not expect any decision by Telkom until
after its annual shareholders' meeting in March, 2001.
Irawan said Pramindo remained committed to installing 100,000
new telephone lines in Sumatra next year.
The company has installed 395,000 lines since it started
operating in Sumatra in 1996.
Pramindo is owned by France Telekom which has a 40 percent
stake, Astratel (35 percent), Indosat (13 percent), Marubeni (8
percent), and International Finance Corporation, a unit of the
World Bank.
Pramindo and four other operators signed an agreement with
Telkom in 1996 to finance, build and operate domestic fixed line
telephone services across the country under a revenue-sharing
scheme through to 2010.
The other four operators are PT AriaWest International in West
Java, PT Mitra Global Telekomunikasi Indonesia in Central Java,
PT Cable & Wireless Mitratel in Kalimantan, and PT Bukaka Singtel
International in eastern Indonesia.
PT Telkom controls the most profitable markets of Jakarta and
East Java. (05)