SSX may merge with JSX

JAKARTA (JP): Shareholders of the Surabaya Stock Exchange (SSX) approved in an extraordinary meeting on Thursday a proposal to merge the virtually inactive bourse with the Jakarta Stock Exchange (JSX).

SSX's chief commissioner Yannes Naibaho, who chaired the meeting, said that no shareholders objected to the merger.

"In principle, all shareholders have agreed with the merger plan,' he told reporters after the meeting.

The SSX and the JSX are the only two exchanges in the country.

He said that shareholders of the exchange had also asked the board of directors to set up a team to study the appropriate way in merging the East Java-based exchange into the JSX.

"This team will work until February 1999 to decide which option to take," Yannes said.

SSX's commissioner Avi G Dwipayana said that merging the two exchanges would be the best possible options for crisis-hit Indonesia to create an internationally reputed stock exchange.

"If we want to compete with the international market, we better consolidate our exchanges."

Separately, JSX president Cyril D Noerhadi said on Thursday that the exchange's shareholders would meet to discuss the merger proposal.

Capital market experts have long urged the government to merge the two exchanges to cut operational costs of listed companies.

The JSX and SSX trade the same companies but have different management. Many companies preferred to list their shares only on the JSX but the capital market authority appealed to crosslist their shares, even though the Surabaya market provided no benefit.

According to analysts, even investors based in Surabaya prefer trade through the JSX, which is more active than their own market. (aly)