PT Indosat cancels plan to sell shares

PT Indosat cancels plan to sell shares

JAKARTA (JP): State-owned international telecommunications
firm PT Indosat has canceled its plan to sell some of its shares
in digital cellular operator PT Telkomsel, sources said
yesterday.

Telecommunications industry sources said the plan was scrapped
because Telkomsel had good prospects and could contribute to
Indosat's future revenue.

In April last year Indosat announced it would sell 7.1 percent
of its Telkomsel shares.

Telkomsel, which operates the global system of mobile
telecommunications (GSM), is 42.72 percent owned by state-owned
domestic telecommunications firm Telkom, 35 percent by Indosat,
17.28 percent by the Netherlands' PTT Telecom and 5 percent by
Setiawan Djody's PT Setdco Megacell Asia.

Telkomsel is the only GSM operator which covers every
Indonesian province. The company has about 220,000 customers and
expects to have 400,000 by the end of the year.

Indosat executives refused to comment but Indosat holds its
annual general meeting next month where questions may be asked.

The president of Telkomsel, Koesmarihati Sugondo, said
recently her company, with total assets of Rp 1.7 trillion and
equity of Rp 1.4 trillion, booked an Rp 50 million inaugural
profit last year.

Koesmarihati said yesterday she did not know Indosat was going
to cancel its plan to sell some of its stake in Telkomsel.

Indosat had said the funds raised by selling 2.5 percent of
Telkomsel would be used to finance its diversification into other
telecommunications businesses.

Vietnam

Indosat executive Steve Yanuar said his company planned to
participate in a telecommunications project in Vietnam.

He said Vietnam had offered a telecommunications project
involving 400,000 fixed-telephone lines and 200,000 GSM lines,
and facilities for 100,000 radio pagers and international call
service.

"Vietnam offered the project under a scheme called the
business cooperation contract for an extendible 30-year period."

He said Indosat would set up a consortium with other partners
to participate in tenders expected to be held later this year.

Yanuar, who is also a top executive at Indosat subsidiary
Camintel, said Indosat would compete with other consortiums like
Thailand's Jasmine, Teledenmark and other firms.

Camintel is a Cambodian-based firm 49 percent owned by Indosat
and 51 percent by the Cambodian Ministry of Post and
Telecommunications.

Camintel was established in 1994 to repair and renovate
Cambodia's telecommunications network. (icn)