SSE plans acquisition over-the-counter bourse

JAKARTA (JP): PT Bursa Efek Surabaya, the manager of the Surabaya Stock Exchange (SSE), will sign an agreement tomorrow on the acquisition of the PT Bursa Paralel Indonesia (BPI), the manager of the Jakarta-based parallel market.

"The signing ceremony of the memorandum of understanding will take place at the Financial Club in Jakarta on July 22," a director of the SSE, Helmy Azwary, said yesterday.

BPI will hold an extraordinary shareholders' meeting on July 28 to liquidate the firm, after which all assets, operations and personnel will be under the management of SSE.

The meeting will also nominate candidates for the new commissioners of SSE.

SSE and BPI currently have five commissioners each. However, the number of SSE's commissioners will remain at five after the acquisition process.

"The composition of commissioners may change but not the management," Helmy said in a press gathering here.

He said BPI's 30 employees will increase the number of SSE's personnel to 70 after the acquisition, while the number of the shareholders will increase to 115

The total assets of SSE will be Rp 16 billion (US$7.1 million) after acquisition.

"It is not compulsory for BPI's shareholders to join SSE," said Helmy, adding that those who intend to join SSE must increase their capital participation from Rp 49 million to Rp 135 million within two years.

After the acquisition, SSE will maintain the current procedures of trading on the parallel market within six months.

"It will be up to the management to change the procedures after six months," Helmy said.

Saturday's signing of the agreement will end the long arguments on the relationship between SSE and the Jakarta Stock Exchange (JSX).

After the acquisition of BPI, SSE will maintain its name, instead of changing into Bursa Efek Indonesia.

SSE's early operation was favored by the government's double listing policy which required share issuers to cross-list their shares both on JSX and SSE. The double listing policy was then abolished following the privatization of JSX in 1992.

BPI manages the listing of the shares of small and medium- scale public companies and conducts odd lot (less than 500 stocks) trading.(kod)