Strategic firms plan to set up more subsidiaries
JAKARTA (JP): State-owned companies supervised by the government's Management Board of Strategic Industries (BPIS) plan to set up more subsidiaries even though some of them suffered losses last year.
State Minister of Research and Technology B.J. Habibie, who also chairs BPIS, said in a hearing with House Commission X for technology that five of the 10 enterprises supervised by the board suffered financial losses in 1995.
BPIS groups aircraft manufacturer PT Industri Pesawat Terbang Nusantara (IPTN), shipbuilder PT PAL Indonesia, steel producer PT Krakatau Steel, telecommunications equipment manufacturer PT Inti, train equipment producer PT Inka, electronics manufacturer PT LEN Industri, engineering firms PT Barata Indonesia and PT Boma Bisma Indra, military equipment manufacturer PT Pindad and explosives manufacturer PT Dahana.
"Most of the BPIS enterprises, especially those applying high technology, are not profitable because they focus more on the development of knowledge and technology so that we have a chance to learn," Habibie said Tuesday.
Among the companies suffering deficits in 1995 were PAL, IPTN, Barata and Boma Bisma Indra.
Habibie refused to disclose the total financial losses incurred by the firms.
Meanwhile, Inti, LEN and Krakatau Steel have showed significant growth in the last few years. The government is currently preparing the initial public offering of Krakatau Steel shares to generate funds of around $700 million in the second half of next year.
Subsidiaries
Habibie said that the firms planning to establish subsidiaries are LEN, Krakatau Steel, Inti, PAL and Pindad.
LEN plans to set up a company to produce plant control systems and provide power plant services, while PAL aims to have an affiliate to produce offshore platforms, and Inti plans to set up a cable manufacturing company, he said.
He said that Pindad will establish a new company producing computers for aircraft manufacturing, while Krakatau Steel plans to set up three subsidiaries to produce electrical steel, stainless steel and tailored blanks.
He said that the establishment of the subsidiaries, mostly in partnership with overseas firms, is planned for the 1997/1998 fiscal year.
Inti, which is licensed to operate cordless telecommunications of the Personal Handy-phone System, currently has one subsidiary. Inka also has one, Boma Bisma Indra one, Krakatau Steel seven, IPTN six, PAL three, Pindad two and Barata has two.
Domestic jet
Meanwhile, State Minister/Cabinet Secretary Saadillah Mursjid said on Tuesday that PT Dua Satu Tiga Puluh (DSTP), a company newly established to finance the production of N-2130 jets by IPTN development, has sold 400,000 of its two million shares.
Saadillah, who is also DSTP's president, was quoted by Kompas daily as saying that the shares -- each worth Rp 2.3 million or US$1,000 -- were acquired by 180 buyers.
DSTP was established last February to seek funds for producing N-2130, the nation's first domestically-made jets.
When announcing the establishment of DSTP, President Soeharto, who is DSTP's chief commissioner, said that the company will seek US$2 billion for the designing, production, certification and marketing of N-2130 jets.
DSTP and IPTN signed a deal in February to cooperate on the designing and marketing of N-2130 aircraft, the first of which, with a capacity of 130 seats, is scheduled to enter the market in 2006.
Soeharto has appealed to all Indonesians to contribute to the jet project by buying DSTP shares, to be sold directly without going through the stock market.
"This doesn't mean that the public are forced to buy the shares," Saadillah said, admitting that the price is quite high.
He said that DSTP cannot enter the capital market yet as there is a requirement that all companies present financial reports for the past three years before being listed. (icn)