PT Kiani Kertas plans Nasdaq share listing
PT Kiani Kertas plans Nasdaq share listing
JAKARTA (JP): The newly-established PT Kiani Kertas, a pulp
subsidiary of the Kalimanis Group, plans to list its shares on
the U.S. Nasdaq stock exchange in 1998, the company's president
said yesterday.
"But I cannot say yet the percentage of our shares to be
listed there," Machnan R. Kamaluddin told The Jakarta Post at a
seminar on Nasdaq and the New York Stock Exchange. "We're still
making preparations for that purpose. And this seminar is part of
our preparations."
He said his company chose Nasdaq because the stock exchange
allows new companies with strong potential to float shares and it
has no requirements on profitability for three consecutive years.
He said that Kiani Kertas is currently constructing a plant in
East Kalimantan.
"We'll start operations next April with a production capacity
of 500,000 tons of pulp per year," Machnan said. He estimated the
company would need a total investment of about US$1 billion, of
which 40 percent would be derived from its own equity and the
other 60 percent from local banks' loans.
Machnan said the company will initially focus on pulp, but may
expand after a few years into paper production.
He said that to feed the pulp plant, Kiani Kertas is
developing about 180,000 hectares of forest industrial estates in
Kalimantan. "Of the total area, we have already planted about
30,000 hectares," he said.
Machnan expressed optimism that his company's listing on
Nasdaq will be successful, partly because of its low production
costs. "When we start operations next April, our production cost
will be around $200 per ton, which will be much cheaper than
foreign producers. We expect that pulp price will be between $650
and $700 per ton," he said.
Pulp prices on the world market currently average at $390 per
ton, Machnan said.
Jack Ribeiro of the U.S. firm, Deloitte Toche Tohmatsu
International Partner, told the seminar that Kiani Kertas has a
good chance to float shares on Nasdaq.
"The stock exchange is very liquid and investors there favor
wood-based companies," he said.
Kiani Kertas is the Kalimanis Group's only subsidiary
specializing in the pulp industry. The group, which comprises of
wood-based companies, is owned by forest tycoon Mohamad (Bob)
Hasan. (bnt)