PT Bumi Modern to float rights shares
PT Bumi Modern to float rights shares
JAKARTA (JP): Publicly listed tourism and hotel concern PT
Bumi Modern said on Thursday it would float rights shares to
raise funds to acquire oil company Gallo Oil Ltd. of the United
Kingdom.
Bumi Modern president Jay Abdullah Alatas said the company had
signed a purchase agreement with Gallo Oil's shareholders, with
various conditions attached.
"Gallo Oil has two blocks of concessions in Yemen with
recoverable oil reserve of about one billion barrels," Jay said
during the company's public expose at the Jakarta Stock Exchange
office.
The two blocks are the 2,856 square-kilometer Block R-2 in
East Al-Maber and the 7,417 square-kilometer Block 13 in Al-
Armah, Jay said.
Gallo Oil is currently 75 percent owned by Minarak Labuan Ltd.
and 25 percent owned by Long Haul Holdings Ltd.
To finance the acquisition, Jay said Bumi Modern would hold a
one-for-24 rights issue, slated for January next year.
The rights issue is expected to raise Rp 9.5 trillion through
the issuance of 19 billion new shares, Jay said.
The right shares will have a nominal value of Rp 500 each and
will be sold at Rp 500.
Shares of Bumi Modern rose 10 percent to close at Rp 300 on
Thursday.
Jay expressed optimism the company's rights issue next year
would be welcomed by existing shareholders even though the
exercise price of the rights shares is above current market
value.
About 98.5 percent of the proceeds of the rights issue will be
used to finance the acquisition of Gallo Oil and the remaining
1.5 percent, or about Rp 150 billion, will go toward
strengthening Bumi Modern's working capital, he said.
Bumi Modern, which is 52 percent owned by Bakrie Capital and
48 percent owned by the public, had total assets of Rp 443
billion as of last June, compared to Rp 423 billion as of
December last year.
Its total revenue was Rp 18.5 billion during the first six
months of this year, compared to Rp 93 billion during the whole
of 1998.
The company booked a net loss of Rp 5 million during the first
six months of the year, compared to a net loss of Rp 29 million
in 1998.
Also on Thursday, property concern PT Modernland Realty said
it expected to complete a debt restructuring deal with the
Indonesian Bank Restructuring Agency (IBRA) within the next three
months.
"We hope to have our debts with IBRA converted into
convertible bonds," company commissioner A.F. Hasan said.
Modernland owes a total of Rp 290 billion to banks controlled
by IBRA.
The company also has US$35 million in outstanding debts to
various noteholders. Hasan said the company was going to work out
these debts soon. (udi)