Sempati Air delays plan for initial public offering

JAKARTA (JP): Private regional airline Sempati Air has delayed its plan to list on the Jakarta Stock Exchange this year because of unfavorable market conditions and an uncertain political environment.

Sempati spokesperson Rima Novianti yesterday told The Jakarta Post the initial public offering would be delayed until next year.

"The market currently focuses on the listing of (the state- owned bank) Bank Negara Indonesia 1946. So we decided to postpone our plan to go public," she said.

Sempati planned to publicly offer between 15 percent and 30 percent of its shares in October or November this year and raise about Rp 200 billion (US$85.32 million) to Rp 300 billion in fresh funds.

The company has selected PT Bahana Sekuritas as chief underwriter and PT Pentasena Securities as financial advisor for the float.

"We'll also consider the political situation next year," Rima said without elaborating.

Next year the country will hold a general election for members of the House of Representatives, which will elect the country's President and Vice President in 1998.

Sempati was set up eight years ago with 25 percent of its shares owned by the Humpuss Group, a diversified business conglomerate controlled by President Soeharto's youngest son Hutomo Mandala Putra, 40 percent by PT Tri Usaha Bhakti, a holding company of the Armed Forces, and 35 percent by timber tycoon Mohammad (Bob) Hasan, one of Soeharto's closest friends.

In April, Sempati agreed to sell 40 percent of its shares to Asian Aviation Inc., a Malaysian-Indonesian joint venture, in order to raise capital before going public. When the decision to go public was made the carrier was 25 percent owned by Tri Usaha Bhakti, 20 percent by Hasan, 15 percent by Humpuss Group and 40 percent owned by Asian Aviation, a company partly controlled by Hasan.

Consolidation

According to Rima, during the postponement period, Sempati would try to consolidate its position to make itself more attractive to investors, Rima said.

"We will also become more financially sound, so that we will be in a good shape."

Aviation analysts said Sempati's financial structure was complicated, making some of its advisors withdraw from float preparations.

Sempati reported in April that after the planned public offering its paid-up capital would increase to about Rp 210 billion ($89.6 million) from Rp 50 billion. The company's profit this year is about Rp 80 billion, compared to Rp 26 billion in 1995.

The company is currently waiting for ISO-9002 certification from the British Bureau Veritas Quality International. (icn)