SGS finishes desk work assessment on timber companies

SGS finishes desk work assessment on timber companies

JAKARTA (JP): Minister of Forestry Djamaludin Suryohadikusumo
said the Geneva-based Societe Generale de Surveillance (SGS) has
finished a "desk-work" assessment on three timber companies
planning to go public.

Speaking to newsmen after opening a forestry seminar,
Djamaludin said the three are PT Artika Optima Inti, a subsidiary
of the widely diversified Djajanti Group, the Surya Dumai Group
and PT Kiani Lestari, which is controlled by timber tycoon
Mohammad (Bob) Hasan.

The minister explained that the desk-work assessment conducted
by SGS is only based on data and information supplied by the
companies or the Ministry of Forestry.

"SGS has not yet conducted a field assessment on the
sustainability of their forest concessions. But, I don't know
whether it is needed or not. It depends on their underwriters,"
Djamaludin said.

He explained that if the underwriters consider a field
assessment unnecessary, the timber companies can directly conduct
a public presentation for their plans to offer shares.

He added that the assessment of forest concessions is
completely separate from the assessment of the business and
financial performance of timber companies.

Timber companies planning an initial public offering of shares
were earlier required to obtain recommendation letters from the
Minister of Forestry before selling shares to the public. The
minister's recommendation letters, however, did not serve merely
as reference but more as permission. They are now, instead,
required to have their forest concessions assessed by SGS because
their business viability and prospects depend on the
sustainability of their concessions, whether their forest
harvesting potency can meet the capacity of their plywood
manufacturing mills, Djamaludin said.

SGS has been sub-contracted by state-owned PT Surveyor
Indonesia to conduct pre-shipment inspections of Indonesian
imports.

Djamaludin reiterated that the government will not interfere
in the going-public process of timber companies but instead
supply necessary information on the companies for those who
require it, including investors.

"From public disclosure, potential investors will get a clear
outlook on a timber company planning to go public. They will,
therefore, decide for themselves whether or not to buy its
stocks. If they still need some more information from us, we will
provide it to them," he said. (rid)