Solution to Semen Gresik sale problem expected soon: Minister
Tantri Yuliandini, The Jakarta Post, Jakarta
The government said on Wednesday that it would propose a new resolution meant to appease the opponents of the sale of its 51 percent stake in Indonesia's largest cement maker PT Semen Gresik to Mexico-based Cemex SA de CV by the end of the week.
"The solution will not discourage international investors and will bring relief to Cemex," State Minister for State Enterprises Laksamana Sukardi said.
The government had planned to sell its shares in Semen Gresik to Cemex last month in a bid to raise around US$520 million, which is about 80 percent of the government's 2001 privatization proceeds target of Rp 6.5 trillion (about $622 million). Cemex, the world's third largest cement company already owns 25 percent of Semen Gresik.
However, the plan was thwarted by protests from local people and legislators from the regions surrounding the PT Semen Padang and PT Semen Tonasa factories, subsidiaries of Semen Gresik, decrying a foreign takeover, and the Oct. 26 deadline for the put option was extended until Dec. 14.
As a protest against the sale, the West Sumatra administration had declared that starting from Nov. 1 Semen Padang was temporarily under the control of the people of West Sumatra. The declaration was later revoked by the administration.
Experts have described the divestment of Semen Gresik as a test case by which foreign investors will be able to gauge the government's seriousness in pushing ahead with asset sales.
Suggesting a peaceful resolution to the problem, noted economist Emil Salim, earlier proposed to the government the establishment of a new parent company for the three cement firms.
The company, dubbed PT Semen Indonesia, would act as a holding company for distribution and marketing, and to be a center for research and development for its three subsidiaries.
PT Bahana Securities, which conducted a study of the proposal, said that the establishment of a new parent company would satisfy the demands of people from West Sumatra and South Sulawesi to be separated from Semen Gresik, and the government's plan to sell its stake in Semen Gresik could also be realized.
The plan was supported by the three companies' president commissioners in a letter dated Nov. 23 to the state minister for state enterprises.
However, Semen Gresik president Urip Timuryono dismissed the commissioners' statement, saying that the management had not received any formal notification of the plan.
"There are no activities at the moment which will lead to that (the establishment of a new holding company," he said on the sidelines of the company's special shareholders' meeting here.
As of Sept. 30, consolidated profits from the three companies was recorded at Rp 365.87 billion, an increase of 130 percent compared to the same period last year.
Semen Gresik recorded a profit of Rp 363.4 billion, Semen Tonasa Rp 40.1 billion, while Semen Padang recorded a loss of Rp 32.6 billion.