PT SI claims merging would be unhealthy

JAKARTA (JP): State-owned PT Surveyor Indonesia (SI) said on Tuesday it would be best for the country to let the two state- owned surveyor companies operate together rather than merge them.

Company president Toga M. Sitompul said that merging PT SI with its sister company PT Sucofindo would be unhealthy because it "would encourage monopolistic practices".

"This could have a negative impact on the national economy which we are reforming now," Toga said.

A number of experts, including legislators, have called on the government to merge the two state surveyors to improve business efficiency and eliminate their competing interests.

Legislator La Ode Kamaluddin of the House of Representative's Commission VIII for the state budget and finance contended that it was too costly to have PT SI and Sucofindo operating together in the same field.

Toga said that his side had no problem with the merger proposal. If the government, as the majority shareholder of the company, agreed with the suggestion, he would be happy to facilitate the process.

"But if the reason is just to create more efficiency, I think it's simplifying the matter and not true because SI is really efficient and is performing well," he said.

He said SI had booked a net profit of Rp 57.1 billion (US$7.1 million) for the first nine months of this year, compared to Rp 15.1 billion recorded for the whole year of 1997.

SI's total assets were about Rp 323.5 billion as of September, 1998, compared to Rp 256,7 billion at the end of last year.

Toga also said the two state surveyor firms did not duplicate each other as they had their own specialities.

He gave as an example the preshipment inspection of Indonesia's imports in that SI had an extensive international network whereas Sucofindo did not.

SI, he said, recently signed a memorandum of understanding with a Vietnamese agency to validate the quality of gas pipes destined for the agency. The value of the contract, however, was quite small, only US$75,000.

The company had also strengthened its appraisal businesses by cooperating with Knight Frank, a world-class appraisal firm.

"As you know, this company could compete with other companies in the world market," he said. (29)