Indonesian Government to Sell Seven SOEs As Part of Expansion Strategy

ID/Agustiyanti

The Indonesian government aims to sell seven state enterprises this year to raise funds to finance expansion plans and improve corporate governance.

The State Enterprise Ministry aims to sell stakes of state postal service Pos Indonesia, state pawnshop operator Pegadaian and state cement maker Semen Baturaja through initial public offerings.

The government also wants to sell shares of Aneka Tambang through a limited public offering or a rights offering and shares in Kertas Leces, Varuna Tirta Prakasya and Bhanda Graha Reksa through strategic investors, said Pandu Djajanto, a state enterprise deputy minister, earlier this week in Jakarta.

Semen Baturaja expects to raise Rp 1 trillion ($103.8 million) by offering two billion in shares, or 35 percent of its enlarged capital, to investors, said the company’s president Pamudji Rahardjo. He said in November last year that the proceeds from the IPO would be used to fund the construction of a new cement plant.

The new plant, Pamuji said, will have the capacity to produce 1.5 million tons of cement a year, boosting the firm’s total production capacity to 3.5 million tons a year by 2016.

The construction of the new plant will cost Semen Baturaja Rp 3.5 trillion and the company has appointed Danareksa Sekuritas, Bahana Securities and Mandiri Sekuritas as the lead underwriters. The IPO has been postponed since October last year.

Pandu said that the government also plans to sell shares of units of PLN Batam, a subsidiary of state electricity company Perusahaan Listrik Negara, and a unit of Garuda Indonesia and state energy company Pertamina. However, Pandu did not specify the target proceeds from these IPOs.

“There will be some IPOs of state enterprise units,” he said.

PLN Batam’s president director, Dadan Kurniadipura, said in August last year that the proceeds from the IPO would be used to help finance projects in Batam including a steam-fueled power plant and a hydroelectric plant.

Batam is home to industrial estates like the Kabil Industrial Estate, a joint venture between Citramas Indah Realtindo and Toba Sejahtra.

Batam is both an island and the biggest city in Riau Islands province.

The Indonesia Stock Exchange (IDX) is home for 458 listed companies with a market capitalization totaling Rp 4,100 trillion. The main stock gauge rose 13 percent last year.