Two Barito log suppliers hand over 49% shares to govt

JAKARTA (JP): Minister of Forestry Djamaloedin Soeryohadikoesoemo announced yesterday that PT Aya Timber and PT Yayang Indonesia in South Kalimantan have agreed to hand over 49 percent of their respective equity shares to government-run firms in return for the renewal of their forest concessions.

"Aya Timber and Yayang are controlled by Prajogo Pangestu but they are not subsidiaries of the listed PT Barito Pacific Timber, which is also chaired by Prajogo," the minister said in a press- conference attended by about fifty reporters.

The minister held the press conference after a closed meeting with Prajogo at his office here. The businessman was accompanied by Barito's chief executive officer, Joso Gautama.

"Aya Timber and Yayang are log-suppliers to Barito but they are not part of the listed company's entities," he said.

Djamaloedin did not mention how many shares Prajogo owns in the two companies.

"Prajogo himself told me just now that he has agreed to meet our demands for the acquisition of 49 percent shares of the two companies," added the minister.

Prajogo, believed to be one of the most politically connected industrialists in the country, was not immediately available for comment. The other Barito executives also declined to comment.

Capital

Djamaloedin explained that the takeover is to be conducted without the injection of fresh capital. "The government will pay for the takeover with the dividends that it will receive from the two companies," he said.

The minister added that the management of both Aya Timber and Yayang was "of doubtful quality" which required the takeover.

Djamaloedin did not elaborate on the extent of the alleged damages in the forest concessions of the two companies, which were reported to reach 121,500 hectares in total.

He said, however, when extending their forest concession rights, the Ministry of Forestry took into account the fact that the two companies supplied raw materials for Barito, the largest company listed on the Jakarta Stock Exchange.

"This is an important industry, especially for exports and foreign exchange earnings. We cannot let exports fall," he said.

Djamaloedin's statement yesterday, consequently, retracted his previous statement on Wednesday that Barito had "poorly managed" its forest concessions and would have to surrender 49 percent of its shares in order to have its concessions renewed.

The minister, however, denied yesterday that he made such statements. He alleged reporters had misquoted him.

"I never said that I was planning such moves against Barito. You people from the press made it up," he said. (hdj)