Sumalindo to acquire Suryaraya for $66.66m

JAKARTA (JP): PT Sumalindo Lestari Jaya, a publicly listed timber company, has agreed to take over PT Suryaraya Wahana, another timber firm.

The company's director, Djojo Boentoro, said the takeover, approved by shareholders yesterday, would cost Rp 333.33 billion (US$66.66 million).

"The acquisition is expected to contribute about 30 percent to Sumalindo's sales next year," he told reporters following the shareholders meeting.

Both Sumalindo and Suryaraya are controlled by PT Astra International. Astra and PT Barito Pacific Timber respectively hold a 45 percent stake in Suryaraya. Other shareholders include PT Nityasa Sentosa (2.87 percent), PT Wahana Adhikencana (2.87 percent), PT Triple A Jaya (2.12 percent) and PT Tri Nur Cakrawala (2.12 percent).

Suryaraya has four subsidiaries -- PT Surya Hutani Jaya, PT Batu Penggal Chemical Industry, PT Nityasa Mandiri and PT Nityasa Prima.

PT Surya Hutani Jaya operates a 183,300 hectare industrial forest concession in East Kalimantan. It has cultivated about 90,535 hectares on the estate.

"The logs from the estate will be supplied to the PT Kiani Kertas pulp and paper plant in Berau regency in East Kalimantan," Djojo said.

PT Batu Penggal Chemical Industry is a glue producer with a 30,000-ton-per-year total production capacity. The company started its commercial operations in 1983.

PT Nityasa Mandiri, which started its operations last May, produces medium-density fiberboard (MDF) with a total production capacity of 110,000 cubic meters per year.

PT Nityasa Prima produces pulp and has 400 hectares of land in Pendingin, Sanga in East Kalimantan.

Djojo said the acquisition of 125 million PT Suryaraya Wahana shares would increase Sumalindo's total shares to 468.75 million from its current 343.75 million shares.

PT Sumalindo Lestari Jaya -- which is currently 39.92 percent owned by PT Astra International, 35.74 percent owned by Barito Pacific Timber, 4.56 percent owned by its management and cooperative and 19.78 percent owned by the investing public -- manages two timber estates of 710,000 hectares and 43,000 hectares in East Kalimantan.

The company also operates two plywood mills with a total annual capacity of 250,000 cubic meters and two MDF mills with a 200,000-cubic-meter-per-year production capacity.

The company, which posted a total net profit of Rp 5.2 billion as of last September, expected to book a higher net profit this year.

"We cannot tell you our net profit projection for this year but it will be an increase from last year," Djojo said.

He said that to finance the acquisition, Sumalindo would issue 343.75 million new shares to raise Rp 343.75 billion.

"All proceeds from the limited public offering will be used to finance the acquisition," he said.

Existing shareholders would be allowed to buy 11 new shares for each four old shares they held.

Djojo said the new shares, each with a par value of Rp 1,000, would be sold at the par value.

He added that if existing shareholders did not want to buy their rights, PT Astra International would buy their shares at the same price. (aly)