Sempati Air shakes up management to go public

Sempati Air shakes up management to go public

JAKARTA (JP): Sempati Air, the country's largest private
airline, announced a major management reshuffle yesterday to mend
its ailing financial performance.

Sempati chief commissioner Hutomo Mandala Putra said the
reshuffle, approved by shareholders early this week, would
improve the company's performance.

Hutomo, affectionately called Tommy, acknowledged the airline
had financial problems, but he refused to explain them.

Tommy, President Soeharto's youngest son, said the reshuffle
was part of a major restructuring plan to prepare for an initial
public offering (IPO) next year.

The shareholders appointed Santun Nainggolan as president
replacing Hasan M. Soedjono, who failed to implement the
airline's plan to go public on local stock exchanges two months
ago, Tommy said.

Santun, 39, graduated from Bandung Institute of Technology
(ITB), and is a former vice president of Citibank. He was a
director of PT Pentasena Arthasentosa and PT Wartaartha before
his new job.

The shareholders replaced commercial director Hasan, who was
also the president, with Arie Johannes J. Toelle of the Humpuss
group.

The technical division was merged into the operations
division.

Sempati Air announced a plan in April to list between 15
percent and 20 percent of its shares this year. The IPO was
expected to raise around Rp 350 billion (US$148 million).

The IPO was delayed because of the airline's poor financial
performance.

Tommy said the new management's primary task was "to carry out
an internal consolidation" to put the airline's performance back
on track.

"With this measure, we hope the public offering plan will be
realized next year," he said. "Sempati Air does not want to
disappoint the public, so it will only go public after its
business performance has improved," Santun said.

Sempati Air is 25 percent owned by Malaysian consortium Asian
Aviation Inc (AAI), 22.5 percent by the Indonesian army's PT Tri
Usaha Bhakti (Truba), 20 percent by PT Humpuss and 20 percent by
Bob Hassan.

Before AAI bought into the firm several months ago, it was 40
percent owned by PT Truba, 35 percent by PT Humpuss and 25
percent by Bob Hassan.

Santun said shareholders had strong reservations on the
reports from the firm's auditor, and they had appointed another
auditor to assess the airline's balance sheet.

Tommy said Singapore Airlines and other major airlines were
keen to buy Sempati shares.

"But the shareholders are still reluctant to accept their
offers," he said.

Tommy said Sempati Air's main goal was to beat Singapore
Airlines as the biggest airline in Southeast Asia.

PT Pefindo, the country's only rating agency, said recently it
was reviewing the A4 rating it had assigned to the airline's Rp
50 billion commercial paper because of its falling operational
revenue. (jsk)