Tjiwi Kimia sells power plant

JAKARTA (JP): Publicly listed paper manufacturer PT Tjiwi Kimia is to sell its power generating unit to affiliate Singapore Power in a move to ease its foreign debt burden.

The unit is to be sold for between US$182 million and US$192 million, Gunawan Taslim, a Tjiwi director, told reporters following a company shareholders' meeting yesterday.

He said that Tjiwi's foreign debt totaled US$1 billion, consisting of $800 million in bonds maturing between 2001 and 2004; and $200 million in bank-syndicated loans.

He also said that independent shareholders had agreed to the management's proposal to sell the power unit to Singapore Power, which is 49 percent owned by the Sinar Mas Group, Tjiwi's parent company.

Tjiwi is one of Indonesia's major paper producers. Eighty percent of its revenue is dollar-based, Gunawan said, adding that many of its products were being sold to affiliates of the well- diversified Sinar Mas Group.

Under the asset-selling proposal, Tjiwi will also have a long- term purchase contract with Singapore Power to provide the company's electricity and steam needs at a selling price of between 1.92 U..S. cents and 2.38 U.S. cents per kwh; and between US$5.35 and US$6.62 per ton, respectively, the company statement said. (08)