Tri Polyta Deal to Create Top Chemical Company

Jakarta Globe, Reuters & JG | September 26, 2010

Tri Polyta Indonesia, the country’s No. 1 maker of polypropylene resins, said on Saturday that it would acquire nonlisted petrochemical firm Chandra Asri in a $1.2 billion share swap to form the biggest player in the sector.

The companies are controlled by Indonesian tycoon Prajogo Pangestu through holding company Barito Pacific.

“We expect the deal to be completed by January 1, 2011,” said Tri Polyta’s director, Suryandi.

Polypropylene resin is a lightweight yet durable material used by manufacturers to create fibers and molds.

Barito owns 77.9 percent of Tri Polyta, which is listed on the Indonesia Stock Exchange (IDX), as well as 70 percent of Chandra Asri. Barito will hold a 71.6 percent stake of the combined company after the deal.

Suryandi said Chandra Asri’s shareholders would be issued 2.93 billion in new Tri Polyta stock worth $1.2 billion in exchange for their equity. He declined, however, to give an indicative price for the new shares.

Tri Polyta has appointed Deutsche Bank and Singapore’s DBS Group as advisers for the share swap deal.

Prajogo, a business tycoon who emerged during former President Suharto’s era, lost ownership of the two chemical companies amid the 1997-98 Asian financial crisis, but has since managed to claw back control of the firms.

Tri Polyta in 2009 booked a net profit of Rp 483 billion ($54.1 million), which marked a huge swing back to profitability after posting losses of Rp 13.75 billion the year before.

Shares in Tri Polyta soared 6.6 percent on Friday to close at Rp 3,250.

Uno May Spend $214 Million Buying Stakes in Consumer Goods Companies

Jakarta Globe, Bambang Djanuarto & Berni Moestafa, February 15, 2010

Indonesia offers “huge potential for companies in the consumer sector," says Sandiaga Uno. (Bloomberg Photo/Dimas Ardian)

Sandiaga Uno, the second-youngest of the nation’s 30 richest people, may invest in consumer companies this year as investors’ interest shifts toward tapping household demand in Asia’s third-most-populous nation.

Uno’s PT Saratoga Investama Sedaya, which manages about $1.5 billion in assets, may spend as much as Rp 2 trillion ($214 million) to buy stakes in consumer companies, he said.

Jakarta-based Saratoga is looking at opportunities in the retail, food and beverage, and pharmaceutical industries among others, Uno said.

The private-equity firm is betting on domestic consumption in Southeast Asia’s biggest economy to boost returns. The country avoided following its neighbors into a recession after nine rate cuts by the central bank bolstered consumer spending, which accounts for about two-thirds of gross domestic product. Fourth-quarter growth was the fastest in a year at 5.4 percent.

“The demographic type of investment that relies on strong sales because of the population and the rise in the middle class has become the new theme of investment,” said Uno, 40, whose fortune is estimated at $400 million. Indonesia offers “huge potential for companies in the consumer sector.”

Growth in Indonesia’s $514 billion economy has been supported by rising consumer confidence, which according to a central bank index rose in January to near the five-year high recorded in July when President Susilo Bambang Yudhoyono was elected to a second term.

Retail-sales growth in Indonesia increased to 33.9 percent in November, the fastest pace in two years. PT Matahari Putra Prima, the country’s biggest retailer, last month sold its stake in a department-store unit for Rp 7.2 trillion, or double the unit’s share price before the deal was announced.

“We’re seriously looking into which pockets of industries still offer reasonable valuations,” Uno said. “We expect to complete an acquisition this year.”

Still, a possible increase in interest rates and under developed infrastructure may hamper investments, Uno said. Bank Indonesia on Feb. 4 kept its key interest rate at a record low of 6.5 percent for a sixth straight month to support consumer spending.

Inflation increased to 3.72 percent in January, the highest in seven months. The central bank may need to “take monetary policy action” if inflation approaches or exceeds 6 percent, Bank Indonesia Deputy Governor Hartadi Sarwono said last week.

Saratoga owns 23.15 percent of PT Adaro Energy, Indonesia’s second-biggest coal producer. The company also has investments in telecommunications and palm-oil businesses.

While Saratoga remains “bullish on coal,” finding new investment opportunities in energy-related industries has been difficult because competition among buyers has driven up the valuations of these assets, Uno said. PT Benakat Petroleum Energy said on Thursday that it signed a deal this month to buy a 37.15 percent stake in oil-services provider PT Elnusa, beating Uno’s Saratoga.

The private-equity firm plans to meet investors on a road show at the end of this year or early 2011 to raise $300 million as more foreign investors express interest in Indonesia, Uno said.

“They’re suddenly starting to look at Indonesia because the growth story is there, the political and economic stability is there,” he said.

Bloomberg

PP expects to raise Rp 581b from public offering

Nani Afrida, The Jakarta Post, Jakarta | Sun, 01/31/2010 6:41 PM

State construction company PT Pembangunan Perumahan (PP) has targeted to raise Rp 581 billion (US$63 million) from its initial public offering (IPO) of shares slated for early February.

Mandiri Sekurities, one of the IPO underwriters, said PP would sell 21 percent of its shares to the public, at Rp 560 each.

Mandiri Sekuritas director and head of investment banking Iman Rachman said investors had shown strong interest in the offer.

“Investors, including two foreign investors, Fidelity and Pheim Asset [Management], have expressed a strong interest in PP shares,” Iman said, adding that several domestic investment firms including PT Jamsostek had also made commitments.

Besides Mandiri Sekuritas, PP has also appointed Danareksa Sekuritas and DBS Vickers Sekurities Indonesia as underwriters.

Earlier PP had said the company would use the public money to finance its investment plan, including for projects in property, construction and the energy sectors.

Established in 1953, PP gained Rp 3.9 trillion in revenue last year.

CVC’s Venture Pays $771 Million to Acquire Matahari Store Unit

Bloomberg, by Widya Utami and Achmad Sukarsono

Jan. 25 (Bloomberg) -- Meadow Asia Company Ltd., a unit of U.K. buyout firm CVC Capital Partners Ltd., paid 7.2 trillion rupiah ($771 million) to buy the department store unit of PT Matahari Putra Prima, Indonesia’s biggest retailer.

Jakarta-based Matahari Putra sold its 90.76 percent stake in PT Matahari Department Store to Meadow, a venture it established with CVC Capital, Benjamin Mailool, president director of Matahari Putra, told reporters in Jakarta today.

Matahari Putra’s shares jumped 10.9 percent to 1,120 rupiah in Jakarta today, the biggest increase in almost two years. The retailer plans to buy a 20 percent stake in Meadow, with an option to purchase an additional 10 percent, Mailool said.

This transaction is “proof of foreign investor interest in Indonesian companies,” said Edwin Sinaga, president director of PT FinanCorpindo Nusa, a Jakarta-based brokerage firm. “The share surged as people expect a tender offer.”

Meadow will also buy another 7.24 percent stake in Matahari Department Store from shareholders, Matahari Putra said in a filing today on the Indonesia Stock Exchange. The agreement was signed on Jan. 23, the statement said.

Matahari Department’s shares surged 24 percent to 1,680 rupiah.

To contact the reporter on this story: Widya Utami in Jakarta at wutami@bloomberg.net; Achmad Sukarsono in Jakarta at asukarsono@bloomberg.net

Last trade

The Jakarta Post, Wed, 12/30/2009 8:06 PM | Business

Stock brokers gather during the last stock trade in Jakarta on Wednesday. Finance Minister Sri Mulyani Indrawati said the Jakarta Stock Exchange was closed at 2,534.356 points, or up by 0.61 percent, making it one of the best in Southeast Asia. (Antara/Andika Wahyu)

Freeport Indonesia unit says may sell stake to local govt

Reuters, Wed Dec 16, 2009 5:58am EST

JAKARTA, Dec 16 (Reuters) - The Indonesian unit of Freeport McMoran Copper & Gold Inc (FCX.N) which runs Grasberg mine in Papua said on Wednesday it is in talks with the local government in Papua about selling it a stake in the unit.

Freeport owns 90.64 percent of the subsidiary, PT Freeport Indonesia, which operates the huge Grasberg copper and gold mine in far-flung Papua province. The Indonesian government owns the remaining 9.36 percent.

"Dialogue and negotiations are ongoing about the possibility of the government of Papua province obtaining ownership shares in PT Freeport Indonesia," Mindo Pangaribuan, spokesman of PT Freeport Indonesia, said in a statement emailed to Reuters.

"The stakes offered will be Freeport's shares," he added, and offered to the Papua provincial government. However, he did not say how big a stake would be sold, or give details of payment, as talks are still in progress.

One possibility reported in local media is that the local government could take the shares in return for part of the royalties it receives from Freeport.

Last year, state miner PT Aneka Tambang Tbk (ANTM.JK) said it might buy a stake of up to 18.72 percent in PT Freeport Indonesia in a deal estimated to be worth about $3 billion. But the deal did not go ahead.

PT Freeport Indonesia has paid an estimated $6.9 billion in the form of royalties, dividends, and taxes to the central government between 2004-2009, of which 9.4 percent is paid to the local governments, the firm said in a statement to parliament recently.

Freeport, unlike some other foreign mining firms in Indonesia such as Newmont Mining Corp. (NEM.N), is not under any obligation to reduce its stake in its local unit.

The head of Indonesia Stock Exchange has said he is keen to get local units of international mining firms such as Freeport and Newmont to list on the bourse to lift trading and lure investors.

Grasberg, which has the world's largest recoverable reserves of copper and the largest gold reserve, accounts for nearly 40 percent of Freeport's total copper reserves of 93 billion pounds, according to the firm's website. The mine is about 3,350 km (2,080 miles) east of Indonesia's capital Jakarta.

Freeport is the world's largest publicly traded copper miner. PT Freeport Indonesia expects to produce 1.4 billion pounds of copper in 2010, unchanged from this year.

BTN to sell stock at Rp800 per share

Antara News, Friday, December 4, 2009 19:06 WIB

Jakarta (ANTARA News) - State-owned Bank Tabungan Negara (BTN) plans to sell its shares at the Indonesia Stock Exchange on December 17, 2009 at a price of Rp800 per share, vice president director Evi Firmansyah said.

She said in a press statement on Friday that the price was set through a careful process by considering various significant aspects involved.

The price was also set through a meeting between the office of the state enterprises minister, the BTN management and the underwriters, namely PT Mandiri Sekuritas and PT CIMB Securities on December 3.

"The price of the BTN shares is set at Rp800 per share while the number of shares to be issued is 2.36 billion," she said.

She said the proceeds would be used to strengthen the company`s capital for future expansion.

The number of shares to be sold is equal to 27.08 of the bank`s shares with 24.48 percent of it for the public and 2.60 percent for the MSOP program.

The price offered is between 1.5 and 2.2 of the book value namely between Rp750 and Rp1.100 per unit.

Sixty-percent of buyers will be local investors while the rest are foreigners, she said.

She said she hoped the proceeds would improve the bank`s capital adequacy ratio from 15.04 percent to 27 percent.

"So, the company`s capital would increase from Rp3.4 trillion to Rp5 trillion to make the leverage for credit distribution to Rp60 trillion," she said.

She said the roadshows that had been carried out so far had been successful not only in the country`s big cities but also in overseas cities such as Singapore, Kuala Lumpur, Hong Kong, Frankfurt, Amsterdam, London and Edinburgh.

She said based on them it was seen that BTN shares had attracted a big interest from foreign investors.

Asian investors interested in buying former Bank Century

Antara News, Friday, November 27, 2009 02:52 WIB

Jakarta (ANTARA News) - Firdaus Djaelani, chief executive of the Deposit Insurance Agency (LPS), said several investors from Asia were seriously considering to buy Bank Mutiara or former Bank Century.

"Several of them have shown serious interest and have come three times to enquire about Bank Mutiara," he said at a press conference.

LPS became Bank Mutiara`s sole majority shareholder after the agency provided the funds needed to prevent ailing Bank Century from collapsing. After the bailout, the bank was renamed Bank Mutiara.

However, Firdaus said, none of the interested investors had so far filed a letter of intent. "They are still talking. But I am optimistic the bank can be sold," he said.

The government has given LPS three years` time and the possibility of extending the period by another two years to sell the bank to recoup the bailout funds totalling Rp6.7 trillion.

"We will sell it for Rp6.7 trillion within five years but if we fail we will sell it for the best possible price," he said.

The president director of Bank Mutiara, Maryono, said he also believed the bank could be sold at the targeted price.

He assumed the bank`s net price would reach an average Rp250 billion per year and so, within five years, a total of Rp1.250 trillion would have been collected. "Since the LPS took it over, the bank`s net profit will not be spent on dividends," he said.

With the value of the bank`s assets recorded at around Rp500 billion based on four times their book value, Rp7 trillion would be a reasonable selling price for the bank, he said.

Some 99.996 percent of the bank`s shares are now held by the LPS with the rest or 0.004 percent belonging to the public and private parties.

"However, if the bank is sold to the holders of 0.004 percent of the shares, they cannot enjoy the proceeds. This is because the bank`s equity was negative when LPS took it over," he said.

Indonesia's Semen Gresik plans $400 mln capex in 2010

Reuters, Thu Nov 26, 2009 4:47am EST

JAKARTA, Nov 26 (Reuters) - Indonesia's largest cement producer PT Semen Gresik Tbk (SMGR.JK) plans capital expenditure of $400 million in 2010 to help cover the cost of building new factories, President Director Dwi Soetjipto said on Thursday.

Semen Gresik has planned capex of $1.2 billion for 2009-2014 to cover the construction of new factories in Java and Sulawesi, a power plant in Sulawesi, and to improve efficiency. The 2010 spending is included in that amount.

Soetjipto told reporters the firm would fund the 2010 capex from its internal cash.

Semen Gresik, which has a stock market value of $4.5 billion, expected production capacity to reach 18.5 million tonnes this year and aims to increase it to 19 million tonnes next year.

Shares in Semen Gresik ended down 1.39 percent on Thursday, while the broader market .JKSE fell 2.76 percent.

(Reporting by Andreas Ismar; Writing by Tyagita Silka; Editing by Sara Webb) ((tyagita.silka@thomsonreuters.com;

Reuters Messaging: tyagita.silka.thomsonreuters.com@reuters.net; +62 21 384 6364 ext 905))

((If you have a query or comment on this story, send an email to news.feedback.asia@thomsonreuters.com))

Pertamina to prepare for IPO

Antara News, Tuesday, November 24, 2009 14:36 WIB

PT Pertamina. (ANTARA/Ardika)Jakarta (ANTARA News/Asia Pulse) - Indonesian state-run oil and gas company PT Pertamina said it may list some of its units on the Indonesian Stock Exchange next year ahead of plans to launch its own initial public offering (IPO).

Pertamina may sell shares in insurance unit PT Tugu Pratama Indonesia, drilling unit PT Pertamina Drilling Services, geothermal unit PT Pertamina Geothermal Energy and energy exploration unit PT Pertamina Hulu Energi, chief financial officer Frederick Siahaan said.

Siahaan said the company would try to list subsidiaries first to increase transparency, adding that Pertamina would retain majority stakes.

Govt to auction Rp2 Trillion bonds Nov 17

Antara News, Thursday, November 12, 2009 22:43 WIB | Economic & Business

Jakarta (ANTARA News) - The government will offer rupiah-denominated state bonds of Rp2 trillion in an auction on November 17, a Finance Ministry official said.

Proceeds from the issuance of the bonds, all of them reopening of the existing issues, will be used to meet part of the financing target in the 2009 state budget, the ministry`s director general of debt management, Rahmat Waluyanto, said in a statement on Thursday.

The bonds up for auction will be series FR0031, FR0040 and FR0052.

The fixed rate bonds series FR0031 due on November 15, 2020 will be issued at a coupon of 11 percent to be paid every May 15 and November 15.

The fixed rate bonds series FR0040 to be issued at a coupon of 11 percent will mature on September 15, 2025. Coupon payments will be made every March 15 and September 15.

The fixed rate bonds series FR0052 due on August 15, 2030 will be issued at a coupon of 10.50 percent to be paid every February 15 and August 15.

"The government has the right to sell the three types of bonds at higher or lower prices than the indicative amount," Rahmat said.

State enterprises consortium prepared to buy Newmont shares

Jakarta (ANTARA News) - The State Ministry for State Enterprises is set to buy 17 percent of the investment stake of PT Newmont Nusa Tenggara (Newmont) by way of a consortium of state-owned companies if the government prioritized state enterprises.

"We have already discussed the planned consortium," State Minister for State Enterprises Sofyan Djalil said at his office in Jakarta Wednesday.

He said today (Wednesday, Apr 8) he had sent a letter to the Finance Minister and the Energy and Mineral Resources Minister asking for the nomination of state enterprises as divestment buyers, unless the government used its purchasing right.

Early this month, an international arbitration court won an Indonesian claim requiring Newmont to divest 17 percent of its stake to the Indonesian government.

Within 180 days following the verdict, the divestment must already been realized, otherwise, the government would have the right to revoke Newmont`s contract of work.

Sofyan said under the prevailing regulations the government could hand over a divestment share to another party unless the state had bought it.

Nevertheless, the minister did not dare to speculate what state enterprise would form the consortium, would they be a mining company or otherwise.

The minister had once suggested to support state enterprises like mining companies, like PT Aneka Tambang, for preparations to buy Newmont shares.

"Some state enterprises will be joining the consortium, but regional administrations are also welcome if interested," he said.

Indonesia bond exchange to reduce refinancing risks

Reuters, 03.30.09, 07:55 AM EDT

JAKARTA, March 30 (Reuters) - Indonesia will offer investors the opportunity to exchange short-dated rupiah debt for longer-dated paper, the finance ministry said in a statement on Monday, in a bid to reduce refinancing risks.

The ministry plans to swap government bonds maturing in 2009-2012 with fixed-rate bonds FR0034, which mature on June 15, 2021 and have a 12.8 percent coupon.

The government will offer to sell the 12-year bonds at 101.5 percent of par value. The debt traded at around 99.5 trade on Monday.

Debt analysts, however, said the debt exchange offers an opportunity for investors to take profits by selling short-dated paper following a recent rally, and to switch to longer-dated bonds amid expectations of lower inflation.

'Bonds have rallied sharply in recent weeks,' said one Jakarta-based bond trader.

'It's a good time to take profits now.'

For the government, the bond exchange offers a chance to extend its debt maturity profile and reduce refinancing risks if the global capital markets experience further bouts of turbulence and upheaval, analysts said.

Indonesia's government, which faces elections this year, has announced a 73.3 trillion rupiah fiscal stimulus package to boost growth and counter the impact of a global economic slowdown.

With the budget deficit forecast at 2.5 precent of gross domestic product this year, the government has turned to the bond markets for funding and has so far raised more than two-thirds of its gross debt issuance target for this year.

The central bank cut its key interest rate by 50 basis points to 7.75 percent earlier in March, bringing total cuts this year to 150 basis points to support economic growth.

The central bank lowered its growth forecast to 3 percent for this year, down from 6.1 percent last year.

(Reporting by Adriana Nina Kusuma and Tyagita Silka; Editing by Sara Webb)

((ga.arka@thomsonreuters.com; Reuters Messaging: ga.arka.reuters.com@reuters.net; +62 21 384 6364 ext 911)) Keywords: INDONESIA ECONOMY/DEBT

(If you have a query or comment on this story, send an email to news.feedback.asia@thomsonreuters.com)

Indonesia's Merukh raises stake in Newmont unit

Reuters, Fitri Wulandari, Mon Mar 30, 2009 9:14am EDT

JAKARTA, March 30 (Reuters) - One of Indonesia's leading mining executives, Yusuf Merukh, has lifted his stake in Newmont Mining Corp's (NEM.N) Indonesian unit to 27 percent from 20 percent, paying $427 million for the shares, he said on Monday.

The purchase by Merukh's privately owned company PT Pukuafu Indah is part of a divestment of shares in PT Newmont Nusa Tenggara (NNT), which operates the Batu Hijau copper and gold mine in eastern Indonesia.

Newmont and Sumitomo Corp (8053.T) own 45 percent and 35 percent respectively of Newmont Nusa Tenggara but under the terms of their mining contract must complete the sale of a 51 percent stake in the company to local investors by 2010.

A 20 percent stake has already been sold to PT Pukuafu Indah and Newmont has agreed to sell a 31 percent stake gradually by 2010.

Newmont also offered to sell a 7 percent stake, valued at $348 million, to the Indonesian government this year, Merukh said.

Merukh's comments came as various shareholders await an announcement by an arbitration court in Indonesia over a previous share sale by Newmont in its unit.

Newmont began offering to sell its shares in NNT in 2006, initially offering 3 percent for $109 million. The following year it offered 7 percent worth $282 million. Indonesia's finance ministry was given the right of first refusal.

However, the government said the share sales could not go ahead because Newmont had missed a deadline to complete the deals.

In February 2008, the energy ministry threatened to annul NNT's contract of work, saying it had not sold its shares in time to local investors. But Newmont said it had sold a 2 percent stake to the Sumbawa local government in January 2008.

Both the government and Newmont filed cases against each other in the arbitration court in March 2008 after talks between both parties on the divestment collapsed. The arbitration court is due to announce its ruling on March 31.

The Newmont case has attracted considerable attention from foreign investors and international mining firms, providing yet another example of a conflict between the Indonesian government and a foreign party over ownership of the country's resources.

Indonesia hosts international resource firms including Freeport-McMoran Copper & Gold (FCX.N) but has struggled to get big new foreign investment in recent years, largely due to uncertainty over the mining laws. (Editing by Sara Webb and David Holmes)

Semen Gresik may acquire a regional rival

Ika Krismantari, THE JAKARTA POST, JAKARTA | Wed, 03/18/2009 10:38 AM

PT Semen Gresik, the country’s largest cement maker, may acquire a 40 percent stake in a regional rival as domestic demand slows and the global economic recession makes assets cheaper.

“At the moment, prices are cheap. We don’t want to lose momentum,” president director Dwi Soetjipto said on Tuesday, adding the company has appointed Credit Suisse Group as acquisition plan adviser.

The targets for this expansion plans are cement companies located in the Philippines, Vietnam and Malaysia now producing cement at a cost of between US$80 to $90 per metric ton, Dwi added.

Highlighting a decline in global prices of assets, Bloomberg reported that the MSCI AC Asia Pacific Excluding Japan Materials Index, which tracks 65 makers of basic materials including cement and metals, has fallen 52 percent in the past year.

The acquisition plan, according to Dwi, has forced the company to again revise its capital expenditure plan budget to be spent between 2009 and 2012, which had been previously revised down to $1.3 billion, from $1.6 billion earlier.

“We are again reviewing our financial plan and the change can be upward as we try to accommodate the acquisition plan in the budget,” he said, without mentioning figures.

Semen Gresik vice president Heru Adiningrat said the company planned to hold a shareholder meeting in May to seek approval for the plan.

So far, Heru added, the company has selected six firms as possible acquisition targets.

Semen Gresik’s acquisition plan aims to help it retain its revenue growth amidst an expected decline in growth of local demand this year.

Cement producers expect domestic sales to increase by 3 percent this year, lower than about 12 percent growth last year, with some growth continuing thanks in part, according to Dwi, to the government’s Rp 71.3 trillion (around US$6.1 billion) economic stimulus plan.

Semen Gresik may produce 19 million tons of cement this year, around 4 percent higher than last year. It currently is the leader in the country’s cement market with a 44 percent market share.

Dwi said that the company targeted to export 1.5 million tons of cement this year, up from 1 million tons in 2008. Semen Gresik exports its products to South Asia, Africa and Middle Eastern countries.

“There’s room for an increase in domestic sales due to the stimulus package,” Dwi said.

“If domestic demand weakens, we’ll boost exports, but if that fails, we’ll reduce capacity.”

During the press conference, the company also announced a 42 percent increase in net profits last year from a year earlier, to Rp 2.52 trillion from Rp 1.78 trillion, as sales rose, facilitating growth in profits.

It sold 17.66 million tons in 2008, up from 16.9 million ton in 2007.

The publicly listed company is 51.09 percent owned by the government, 24.01 percent by Blue Valley Holdings — a subsidiary of business conglomerate Rajawali Group — and 24.9 percent by the investing public.

Kalimantan Gold in India talks on Indonesian coal

Reuters, Mon Mar 16, 2009 7:39am EDT  

JAKARTA, March 16 (Reuters) - Canadian mining firm Kalimantan Gold Corp. is in talks with an Indian power plant on equity participation and a supply deal in a coal project in Indonesia's East Kalimantan, a company official said on Monday. 

Kalimantan Gold (KLG.V), a junior mining firm listed on Canada's TSX Venture Exchange and the AIM Exchange, said in November last year it had signed an option with a local firm PT Indobara Pratama to bring its coal deposits into production and acquire up to an 80 percent stake. 

The firm has an exclusive 90-day option on due diligence as well as for a drilling programme during this period, Kalimantan Gold said in its statement. 

PT Indobara owns a coal mine in East Kalimantan which has potential deposits of between 55-60 million tonnes of 5,400 kcal/kg of coal, Kalimantan Gold said in December. 

"We are inviting them (the Indian power firm) because for this type of coal you need long term and certainty. It's not the type of coal you can sell for spot market," said Mansur Geiger, Kalimantan Gold's vice president for exploration. 

"They will own shares and they will be responsible for the coal off-take," Geiger told reporters, adding the mine is expected to start commercial production in September. 

He did not name the Indian power plant or give the number of shares it might take up in the project. 

The coal mine is expected to produce 1 million tonnes in the first year, gradually increasing to 5 million tonnes within 4-5 years, he said. 

Indonesia' energy ministry expects the country to produce about 230 million tonnes of coal this year, unchanged from 2008 on expected slowing demand. 

But industry officials said the country's coal output may reach 250-260 million tonnes as coal consumption by India and China would help shore up demand.[ID:nDEL409393] 

India's demand for coal is growing by around 8-9 percent a year, outpacing production that is growing by 6 percent as the power sector has not been as badly hit by the credit crunch. 

The government expects Indonesia's coal output to increase to 250 million tonnes in 2010 and 321 million tonnes by 2015. 

(Reporting by Fitri Wulandari; Editing by Ed Davies)

Indonesia's Excelcom says aims for rights issue in Q2

Reuters, Tue Mar 17, 2009 8:05am EDT  

JAKARTA, March 17 (Reuters) - Indonesia's third-largest mobile phone operator, PT Excelcomindo Pratama Tbk (EXCL.JK), said on Tuesday it is considering a rights issue in the second quarter to help finance its capital expenditure. 

"The rights issue is expected in the second quarter but details will be decided during the shareholders meeting on Thursday," Hasnul Suhaimi, the president director, told reporters. 

The firm said on Sept. 3 it may sell between 10-15 percent of its share capital to the public. But it has not released further details, while the Indonesian market has been hit by the global financial crisis. 

The company has said it wants to spend about $600-$700 million on capital expenditure this year, compared with 14 trillion rupiah ($1.17 billion) in 2008. 

Suhaimi also the firm is aiming to reach 30 million subscribers this year, up from 26 million in 2008 when subscriber growth was 68 percent. 

Malaysia's TM International (TMIT.KL) controls 83.79 percent of Excelcom while Emirates Telecommunications Corp (ETEL.AD) holds a 15.97 percent stake in the Indonesian company. ($1= 11,965 rupiah) (Reporting by Andreas Ismar; Editing by Sara Webb)

QTel acquires additional 25 % stake in Indosat

TelecomTiger.com, TT Bureau, 09 Mar 2009  

Qatar Telecom (QTel) successfully completed its acquirement of PT Indosat, as it bought an additional 1,314,466,775 shares of the company to now own 65 percent shares as compared to its initial 40.81 percent. 

The acquisition, which was done via dual concurrent tender offers in Indonesia and the United States, represent QTel’s aspiration of becoming a global to 20 telecommunications provider by the year 2020. 

Priced at 7,388 Indonesian rupiahs per share (or the US dollar equivalent per ADS), the offer began on January 20, 2009. Qtel could purchase in the tender offers, which was capped at 1,314,466,775, or about 24.19 percent of Indosat’s total issued and outstanding shares. 

However, this exceeded the maximum number of Indosat shares Qtel could purchase in the tender offers, which was capped at 1,314,466,775, or about 24.19 percent of Indosat’s total issued and outstanding shares. 

Due to the oversubscription, Qtel announced a pro-ration factor of about 56.54 per cent on this basis,  accepted for purchase 1,314,466,775 Indosat shares on a pro rata basis from all tendering shareholders. Tendered shares that were not accepted have been returned to shareholders. 

Qatar Telecom currently has stakes in 16 countries, including the Middle East and Asia and enjoys a customer base of more than 57 million.

Danareksa to sell Rp 300 billion of 2-year bonds

The Jakarta Post,  Jakarta | Thu, 02/19/2009 2:10 PM  

State investment company PT Danareksa plans to issue Rp 300 billion (US$25 million) worth of two-year bonds next month. 

In its announcement Wednesday, the bond would have a two-year maturity period with the offering to start between March 6 and 17, and a minimum order of Rp 5 million. 

The bond, which will have a fixed interest rate, is scheduled for a listing on the Indonesia Stock Exchange on April 15. 

Proceeds from the bond are aimed entirely at strengthening the company's working capital. 

Danareksa has appointed its unit Danareksa Securities as underwriter of the bond and Bank Mega as custodian. 

During the first nine months of last year, the company booked total revenue of Rp 263.4 billion and a good net profit of Rp 129.1 billion. 

Danareksa recorded a revenue of Rp 505.8 billion and a net profit of Rp 56.1 billion in 2007 as against Rp 334 billion of revenue and a Rp 98.4 billion net profit in 2006. 

The company assets worth of Rp 3,3 trillion as of 2007, up by 53 percent from 2,15 trillion in 2006. 

Danareksa has said earlier it is targeting to underwrite bond issues worth between Rp 5 trillion and Rp 7 trillion during the first semester of the year. 

The bonds will be issued by state power company PT Perusahaan Listrik Negara, and state lender Bank Tabungan Negara. 

Aside from Danareksa Securities, the company also has four other subsidiaries including PT Danareksa Investment management, PT Danareksa Finance, PT Danareksa Futures, and PT Danareksa B.V. 

Late last year, State Minister for State Enterprises Sofyan Djalil said the government was considering Danareksa should become the holding company for banks in which the government had a majority share. 

Under the central bank's single presence policy, an investor, either from the public or private sector, is not allowed to own a majority stake in more than one bank. Those controlling stakes in more than one bank must merge their banks, conduct an acquisition or establish a holding company at the latest by 2010.

Danamon to rise ownership in Adira by 20%

Ika Krismantari, The Jakarta Post, Jakarta | Fri, 02/13/2009 3:58 PM 

The country's fifth largest bank Bank Danamon will exercise its rights to increase its share ownership in PT Adira Dinamika Multi Finance by 20 percent this year. 

The rights, in the form of a call option, are set out in the 2004 purchase agreement signed when Danamon acquired its 75 percent stake in Adira, a multi-finance firm. 

The exercize of these rights will bring Danamons' ownership up to 95 percent of the multi -finance firm. 

"We intend to exercise out rights to call up 20 percent of Adira in 2009, the deadline year," Danamon president director Sebastian Paredes said on Thursday. 

He refused to disclose the total value of the deal as it was still under calculation. 

However, he said that the company would finance the acquisition from internal cash, as the bank had enough funds to do so, amounting to US$460 million at the end of 2008. 

With that amount, Paredes said that the company would also plan to buy back $ 300 million of sub-debts by the end of March. 

"We have already sent today an instruction to pay our sub-debts at the end of March," Paredes said. 

The sub-debt has a maturity date of 10 years, which will fall in 2014, but the bank has the option to buy back the debts in 2009. 

Danamon's decision is good news for Indonesian banking amidst the gloomy global scenario, which has caused some banks to drop their buy back options. 

Korea-based Woori Bank, Germany's Deutsche Bank and Spain's Banco Sabadell are among those failing to implement buyback plans. 

Referring to Danamon's targets in 2009, Paredes said that the bank had projected that loans would grow at less than 10 percent this year,. 

Of that figure the loans from small and medium enterprises would increase steadily at a growth rate of 20 percent. 

In 2008 the amount of loans grew by 25 percent to Rp 66.9 trillion ($ 5.6 billion), 60 percent of which came from small and medium enterprises. 

At the same year, Danamon's net profits dropped by 28 percent to Rp 1.5 trillion, from Rp 2.1 trillion in 2007 as it had set aside a major provision to cover possible losses on derivatives transactions. 

A derivative transaction is a foreign exchange contract that derives its value from an underlying asset, commodity or liability, and is normally used as a hedging or investment tool. 

Danamon director and chief financial officer Vera Eve Liem said that the company had set aside Rp 800 billion for the provision in 2008, an amount considered as adequate to anticipate troubles in the future. 

Vera explained that so far Danamon had 22 customers who had been exposed to derivatives products, with a total contract value of $220 million. 

She added that of these customers, there was only one customer which seemed to have problems. 

The company is publicly listed PT Elnusa, which is the subsidiary of state owned oil and gas firm Pertamina. 

Danamon is still in negotiation with Elnusa to resolve a $9 million discrepancy caused by the fall in the Rupiah in the end of 2008, Danamon vice president Jos Luhukay said. 

Eva said that total discrepancies in the 22 contracts reached up to $49 million. 

Problems with derivatives products arise when many exporters, who have hedged their currencies, get burned amid falling commodity prices and weak export demand, thus having problems in fulfilling their obligations.