United Tractors to raise $83.27m from rights issue

United Tractors to raise $83.27m from rights issue

JAKARTA (JP): Publicly listed PT United Tractors, a major
heavy equipment distributor in the country said yesterday that it
expected to raise about Rp 241.5 billion (US$83.27 million) from
its rights issue later this year.

ING Barings, the company's financial advisor, said yesterday
United Tractors would seek approval from its shareholders for the
planned rights issue at an extraordinary shareholders meeting on
Oct. 31.

Existing shareholders would have rights to buy one new share
for every two shares they hold at Rp 3,500 (US$1.20) each, it
said.

The proceeds would be used to continue the expansion of each
of its four business divisions of construction machinery, mining
contracting, mining and material handling, the securities company
said.

The one-for-two rights issue is scheduled for completion in
December.

United Tractors' president M.A. Imanto said his company
enjoyed strong stock market support this year before the recent
turbulence in the regional financial markets.

"The rights issue will give us the opportunity to explain to
investors the continued excellent outlook for our business," he
said.

The company said PT Astra International, which has a 50
percent stake in United Tractors, had indicated its strong
support for the company and agreed to subscribe all new shares it
was entitled to.

Astra International's subsidiary, PT Astra Securities, would
act as standby purchaser for the public portion of the rights
issue, the company said.

United Tractors booked Rp 73 billion in net income and Rp 1.98
trillion in sales last year, it said.

The company also has extensive business interests in mining
through two of its subsidiaries, PT Pamapersada Nusantara and PT
Berau Coal.

Pamapersada is the largest mining contracting company in the
country and Berau holds a 30-year concession coal mine in
Kalimantan with 255 million tons of measured reserves. (das)