PT Telkom cuts its share issue
PT Telkom cuts its share issue
JAKARTA (JP): State-owned domestic telecommunications firm PT
Telkom, which will conduct its local and overseas primary share
offering tonight, yesterday cut its offering price and downsized
its issue.
Telkom said in a statement last night that it had set the
price of its shares at Rp 2,050 (90 U.S. cents) each on domestic
markets and at US$18 per American Depository Share (ADS) on
overseas markets.
The company initially set the maximum price at Rp 2,800
($1.22) per share on domestic markets. Meanwhile, the price of
its offered shares on offshore markets was estimated to range
from $19.50 to $24.50 per ADS.
One ADS represents 20 ordinary shares.
Telkom also scaled down its offshore flotation by 57.1 percent
to 30 million ADS from its initial allotment of 70 million ADS.
However, it did not change the size of its domestic issue.
The company plans to make the primary offering of its shares
on the London, New York, Jakarta and Surabaya stock exchanges
simultaneously today.
The Jakarta and Surabaya stock exchanges will have a night
trading session from 9:30 p.m. (14:30 GMT) until 11:30 p.m.
(16:30 GMT) tonight to launch the debut at the same time as New
York.
The state-run television station TVRI will broadcast
nationwide Telkom's primary offering, believed to be Indonesia's
largest public offering, live from New York and Jakarta.
Telkom said recently that its domestic offering of 1.16
billion shares, or 12.5 percent of its enlarged capital, was
oversubscribed by 8.17 percent.
The government initially hoped to raise between $2.5 billion
and $3.1 billion by offering 12.5 percent of its shares on the
local markets and 15 percent on overseas markets.
Securities analysts speculated that the sudden cut in Telkom's
issue was driven by overseas investor interest in the company's
shares was "cold".
They said the fate of Telkom's listed upon their flotation
tonight was likely to have an impact on the government's
privatization plans for the future.
They added, however, that neither the government nor global
the offering's coordinators could be blamed for the poor timing.
They said the market was still haunted by state-owned PT
Tambang Timah, whose price fell some 17 percent from its initial
offering price of Rp 2,900 ($1.30) after only five days of
trading.
The Jakarta Stock Exchange's composite index hit a seven-month
low yesterday, falling to 467.35 points, as compared with a 1995
high of 519.53 in August. (rid)