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Prime to go ahead with IPO
Ika Krismantari , The Jakarta Post , Jakarta | Tue, 09/16/2008 10:22 AM | Business
Integrated oil and gas service provider PT Prime Petroservices (PPS) will stick to its plan to publicly offer 30 percent of its stake next month despite uncertainty in the stock market.
After a two-month delay, PPS is optimistic the initial public offering (IPO) will take place in early October, once the company secures a permit from the stock market regulator.
Under the IPO plan, the company will sell 1.78 billion new shares at Rp 205 (2 U.S. cents) a share.
"We believe the economy's fundamentals are still doing great. That's why we're upbeat about proceeding with the plan," PPS finance director Didit A. Ratam told The Jakarta Post on Monday.
PPS expects to rake in nearly Rp 360 billion from the IPO proceeds, with some 90 percent being used to help finance its liquefied natural gas (LNG) project while the remaining 10 percent goes toward working capital.
The company plans to build a Rp 3 trillion LNG plant this year on Pagerungan Island, north of Bali, with a total capacity of 300,000 tons per year.
According to PPS, the new plant will be Indonesia's fourth, after Bontang in East Kalimantan, Arun in Nanggroe Aceh Darussalam and an ongoing Tangguh project in Papua, scheduled to go online by the end of the year.
PT Madani Securities, PT Ciptadana Securities and PT Recapital Securities have been appointed as the underwriter for the IPO.
PT Eclipse Pacific Service owns 79 percent of PPS, with 9.8 percent held by PT Barata Makmur Abadi and the remaining portion split between several companies.
The company expects to list its shares on the Indonesian Stock Exchange (IDX) on Oct. 15, making it the 19th company to go public this year. The IDX hopes to have a total of 30 companies offering IPO's in 2008.
The Composite Index has shed more than 10 percent since last week following a combination of worries, particularly a decline in commodity prices that has the potential to dampen the commodity-heavy economy.
