Singapore's Neptune bids for Indonesian terminal

Singapore's Neptune bids for Indonesian terminal

SINGAPORE (Dow Jones): Neptune Orient Lines Ltd. Wednesday
said its American President Lines unit is leading a consortium
bidding for 48.52 percent of a container port in Jakarta.

A NOL spokeswoman confirmed Wednesday APL is bidding to be the
second largest shareholder in Koja Container Terminal at
Jakarta's Tanjung Priok port.

The Koja terminal is 51 percent-owned by the state-run PT
Pelabuhan Indonesia, or Palindo, while the remaining shares are
owned by the Humpuss Group, controlled by Hutomo Mandala Putra,
former president Soeharto's youngest son, the Business Times
reported Wednesday.

The NOL consortium also includes the Singapore government's
investment arm, Temasek Holdings Ltd., and Singapore-listed
Indonesian shipping company, Samudra Shipping Lines Ltd. (P.SDS),
the newspaper reported.

NOL's regional rival, Hong Kong's Hutchison Whampoa Ltd. and
an unnamed Indonesia group are also said to have placed bids.

The Singapore consortium is reportedly offering US$150 million
for the stake, but the NOL spokeswoman declined to confirm the
figure.

Ron Widdows, NOL's senior vice president for operations, said
in a statement that the port will help NOL cut costs and improve
operations.

"The Koja Terminal would better protect our interests and
provide APL with the ability to have a greater influence in the
operations of the terminal, providing better controls over costs
for our business in Indonesia," he said.

Koja, a two-berth terminal with five cranes, won't be a
dedicated terminal as "we and out potential partners have
substantial volumes, and the terminal would have other customers
as well," Widdows said.

Analysts say the APL-led consortium has a "strong" chance of
securing the bid.

"The consortium has the political connections, the management
expertise and the deep pockets to pull this through," said one
analyst who declined to be named.

If successful, NOL will be the second Singapore company to own
a chunk of a distressed Indonesian company.

Earlier in the year, auto distributor Cycle & Carriage Ltd.
successfully bid for a cornerstone PT Astra International Ltd.
Its consortium included the Government of Singapore Investment
Corp.

NOL later confirmed that APL will be buying the stake
currently held by the Humpuss Group.

The Business Times said Humpuss will use the proceeds from the
sale to pay the Indonesian Bank Restructuring Agency, or IBRA,
which took over a large part of the group's Rp 5.46 trillion debt
when it took over loans from banks closed by the Indonesian
government last year.