Telkom to finish Ariawest buyout

Telkom to finish Ariawest buyout

JAKARTA: PT Telekomunikasi Indonesia aims to finalize this
week plans to pay US$390 million to take over a telecom company
partly owned by AT&T Corp of the U.S.

The company, PT Ariawest International, has been at
loggerheads with state-owned Telkom over a revenue-sharing pact
which soured after the 1997-98 Asian financial crisis.

Telkom will pay $120 million for Ariawest's assets and take
over $270 million worth of debt over five-and-a-half years, a
source involved in the deal told Dow Jones Newswires.

"Payments will be made every six months," said the source, who
spoke on condition of anonymity.

Ariawest began offering local call services in West Java in
the mid 1900s in one of five agreements between Telkom and
various foreign-led joint ventures. Telkom, which until this year
had a monopoly on local call services, took 30 percent of
revenues from these joint ventures, locally known as KSOs, in
return for allowing the companies exclusive rights to build and
operate fixed lines. -- Dow Jones