Telkom refrains from raising new loans

Telkom refrains from raising new loans

BANDUNG, West Java (JP): The state-owned domestic telecom
munications operator PT Telkom, which floated its shares on
domestic and overseas stock markets last month, won't be seeking
new overseas loans within the next few years.

Telkom's president, Setyanto P. Santosa, said here on Saturday
that after being successful in its initial public offering, the
company is delaying its plans to raise aid in the next two to
five years.

"Telkom's liabilities totaled US41.7 billion as of June 1995,
with payback periods ranging between 15 and 20 years," he told
reporters during a gathering to celebrate Telkom's initial public
offering.

Telkom usually raises financial aid from the World Bank and
the Asian Development Bank for its large-scale telecommunications
projects throughout the country.

Telkom floated 19 percent of its 9.33 billion shares on the
New York, London, Jakarta and Surabaya stock exchanges in Novem
ber. The company raised Rp 2.3 trillion (US$1 billion) from the
domestic offering and $519.1 million from the overseas offering.

Telkom's finance director, Muljohardjoko, said that from the
funds raised domestically, only Rp 1.85 billion went back to his
company, while the remainder has gone into the government's
coffers. The funds raised from the overseas offering were also
handed over to the government.

Meanwhile, the Minister of Tourism, Post and
Telecommunications Joop Ave said that Telkom must fulfill its
promises about the utilization of the funds raised from the share
offerings.

"Telkom is now owned by 350,000 retail investors. Each of them
has the same rights to information about Telkom's plans and fund
utilization," he said.

The company plans to use 40 percent of the funds to finance
its capacity expansion, 40 percent for quality enhancement and
the other 20 percent for business development.(icn)