Semen Gresik vows to dismiss ex-CEOs

Evi Mariani, The Jakarta Post, Jakarta

After years of struggle, publicly listed cement producer PT Semen Gresik is now preparing to regain control of its subsidiary PT Semen Padang in West Sumatra following the verdict by a district court ordering Padang's defiant old management to leave the firm.

Gresik vowed on Wednesday to use every legal means to oust the old management.

On Aug. 13, the Padang District Court issued a ruling ordering the former Padang directors and commissioners to leave the company's compound and allow the new management appointed by Gresik's shareholders to take over.

The ruling also said if the former management disobeyed the ruling, they would be fined Rp 10 million (about US$1,100) each day following the date the ruling was issued. However, no deadline was set for the execution of the ruling.

"We will ask the court to issue an order to execute its verdict as soon as possible," said Gresik's lawyer Todung Mulya Lubis on Wednesday at his office in Jakarta. "We will ask legal officers to use force if necessary."

Gresik spokesman Suaeb Asmarawitjitra explained that Gresik had not been able to gain clear information about the latest situation at the Padang plant as they could not enter the compound.

However, he said he had received reports stating that the former management had left the compound, but the new management could not enter the compound because some employees had blocked the way.

Lubis and Suaeb could not come up with any solutions on how to handle the defiant employees.

Last month, thousands of workers of Semen Padang prevented the firm's new management team and Gresik's president Satriyo from entering the compound. The workers blocked the main entrance.

Previously, Gresik claimed the new management team, appointed by an extraordinary shareholders meeting in May this year, was able to carry out its important duties from outside the office, despite resistance from some employees and a dismissed top executive.

The lengthy dispute has made Gresik unable to complete its consolidated financial report, forcing the Jakarta Stock Exchange (JSX) to suspend Gresik's stock trading from May to June.

Gresik is 51 percent owned by the government, 23.46 percent by the public and 25.53 percent by Mexico's Cemex SA de CV who became SG shareholders in 1998.

The conflict between Gresik and Semen Padang centered around the government's plan to sell its remaining 51 percent stake in Gresik to Cemex.

Padang's old management and some nationalist politicians against the privatization of the firm demanded that Semen Padang be spun off from Gresik,

Gresik owns 99.99 percent of Semen Padang shares and totally owns Semen Tonasa in South Sulawesi.

Data shows that Gresik's combined output is 17.25 million metric tons per year. Meanwhile, Semen Padang has an annual capacity of 5.5 million metric tons and Tonasa has an annual capacity of 3.48 million tons.