PT Timah to float shares in London in mid-October

JAKARTA (JP): The state-owned tin mining company PT Timah announced yesterday that it will float shares on the London, Jakarta and Surabaya stock exchanges in mid-October.

"We estimate that the stock markets at that time will be in good condition," the company's president, Erry Riyana Hardjapamekas, told reporters at a press conference here.

The London Stock Exchange (LSE) has been chosen because of its size, even though there is a London Metal Exchange, he said.

Erry declined to say how many shares would be listed, but he said the company would follow the pattern of Indosat. Indonesia's international telecommunications operator Indosat listed 25 percent of its shares on the New York Stock Exchange last year and a further 10 percent on the Jakarta and Surabaya capital markets.

Timah's director of finance, Maryat Nirwana, said that the company will sell 35 percent of its shares. He said 10 percent of the shares would be new stocks, sold on local markets, while the other 25 percent would be government shares and would be sold on the LSE.

Maryat said that the proceeds from the sale of the new shares will be used for capital expenditure, as follows: 45 percent for the up-grading of the firm's dredgers, 32 percent for production facilities, 17 percent for new exploration, 4 percent for improvement of Timah's smelters and 2 percent for information equipment.

He said that the nominal price of the company's shares is Rp 500 each.

Erry declined to answer questions about the use of the proceeds from the sale of the government's shares on the LSE. "It's not within my authority to answer. Ask the government about it," he said.

He said that the government has appointed Barclays Zoette Wedd of Britain as the global coordinator for the initial public offering on the international market.

PT Niaga Securities, an affiliate of publicly-listed Bank Niaga, and PT Pentasena Securities, a company controlled by businesswoman Siti Hediati, will act as underwriters for the share issue on the domestic market.

Erry said that the company's net profit reached Rp 43 billion in the first six months of this year, while its net profit last year was Rp 120 billion.

Patia Panjaitan, the company's operations director, said that there were two tin mining companies in Indonesia, Timah and PT Koba Tin. The latter is 25 percent owned by Timah and 75 percent by Radisson Gold Fields Corp. of Australia.

Timah has 490,000 tons of proven tin reserves in its mining concessions, which total 786,657 hectares, in South Sumatra, he added.(04)