Two firms to launch IPOs mid-March

The Jakarta Post, Jakarta

Two companies are planning to offer their shares to the public through the initial public offering (IPO) mechanism some time in the middle of this month despite rising political tension as the election campaign start next week.

Agriculture biotechnology firm PT Bumi Technocultura plans to sell around 120 million shares, or 10 percent of the company's total shares, at Rp 125 each.

The company was quoted by detik.com as saying that the shares would be on offer between March 18 and March 23, and would be listed on the Jakarta Stock Exchange on March 30.

Local securities firm PT Inovasi Utama Sekurindo has been appointed as the lead underwriter.

Bumi will also offer warrants during the IPO.

The company plans to use the Rp 10 billion (US$1.19 million) it expects in IPO proceeds to finance the purchase of capital goods and new machinery, Rp 3 billion to expand its land bank and Rp 2 billion for working capital purposes.

Last year, the company enjoyed a profit of Rp 666 million, after suffering losses in the previous two years.

Meanwhile, Dow Jones reported that oil and gas company PT Energi Mega Persada will issue about seven billion to eight billion shares in the middle of this month through an IPO.

Chief financial officer Nazamudin Latief said that the company expected to raise between Rp 350 billion and Rp 400 billion, which would be used to develop new onshore oil and gas fields in East Java, and Kondur Island, a small island off Sumatra.

The company has appointed PT Danatama Sekuritas as the lead underwriter for the offering.

"The number of shares we will offer to the public will account for between 25 percent and 30 percent of the company's total shares," Nazamudin said.

Energi Mega currently produces 12,000 barrels of oil, and 80 million cubic feet of natural gas per day, he said.

The company will be the second oil and gas company to be listed on the local stock market. Currently, the only energy company listed on the Jakarta and Surabaya stock exchanges is PT Medco Energi International.