Sucofindo chosen to reevaluate PLN's assets

JAKARTA (JP): The government has appointed state surveyor company PT Sucofindo to reevaluate the assets of state electricity company PT PLN.

Minister of Energy and Mineral Resources Purnomo Yusgiantoro said the ministerial team supervising PLN's restructuring recently approved the appointment of Sucofindo.

"The plan is that Sucofindo will complete the reevaluation of PLN's assets in January next year," he was quoted as saying by Antara on Friday.

The reevaluation of PLN's assets will allow the company to raise the book value of its assets to current market price levels, thus leveraging its assets against its liabilities.

The state company is on the verge of bankruptcy with short- term debts of over US$2.36 billion and projected net losses of more than Rp 11 trillion ($1.15 billion) this year.

An earlier request to have the government bailout its short- term debts received a mixed response from the ministerial team, which instead ordered PLN to reevaluate its assets.

While Purnomo supported the request, Coordinating Minister for the Economy Rizal Ramli was against it. Both are members of the ministerial team.

However, Purnomo said the government might still consider taking over PLN's debts, adding the team had not made any final decisions.

He also voiced support for freeing PLN from requirement of paying income taxes based on the results of the company's asset reevaluation.

He said that "personally" he would grant PLN the tax exemption.

"Isn't the goal of the reevaluation to return PLN to health?" he asked.

Under the current tax law, PLN would be required to pay 10 percent income tax on any profits from the asset reevaluation process.

PLN president Kuntoro Mangkusubroto has said PLN's assets stand at Rp 68 trillion, but will swell to Rp 193 trillion after the reevaluation.

The resulting difference in the value, subtracting PLN's current losses, will result in the company earning a net profit of some Rp 100 trillion, he explained.

That profit, he said, was subject to a 10 percent income tax payment.

"So if we pay an income tax of 10 percent, then we will have to pay Rp 10 trillion in taxes," Bisnis Indonesia daily quoted him as saying.

PLN finance director Parno Isworo said the process of reevaluating PLN's assets might take up to three months.

According to him, the final results of the reevaluation may have to wait until PLN issues its annual financial report in April. (bkm)