Telkom, Pramindo seal buyout deal

The Jakarta Post, Jakarta

State telecommunications company PT Telkom said on Friday that it has finally completed a planned asset buyout with its joint operating partner, PT Pramindo Ikat.

"Both parties have agreed on a buyout deal," Mursyid Amal, Telkom's financial director, told The Jakarta Post.

He declined to reveal its value, however, as "both parties agreed it will be announced only after we sign a memorandum of understanding on Feb. 14."

The announcement of this deal ended a protracted negotiation between Pramindo Ikat and Telkom that had lasted for nearly ten months.

Pramindo Ikat is one of five Telkom's KSO (joint operation scheme) partners that were granted contracts in 1995 with which to construct and operate telephone lines in various provinces.

Pramindo holds a 15-year contract to develop and manage telephone lines in Sumatra.

The introduction of a new telecommunications law that ends Telkom monopoly has led the company to a prolonged dispute with its KSO partners.

Pramindo is 40 percent owned by Astratel Nusantara, a unit of Astra International; 35 percent by France Cables et Radio; 13 percent by PT Indonesian Satellite Corp. (ISAT); eight percent by Marubeni, and two percent by Nichimen Corp.