PP may sell shares in first quarter, 2010

State housing company PT Pembangunan Perumahan (PP) is unlikely to sell stakes through an initial public offering (IPO) this year as previously planned, pending a government regulation, a minister says.

"The *IPO* plan is still in process. The PP may sell its stake in the first quarter of next year," State SOE Minister Mustafa Abubakar said over the weekend, adding the government was still preparing a government regulation to ensure the process ran smoothly.

"It will be difficult to finish this year because of the Christmas and New Year's festivities," Mustafa said.

The government previously said it would sell between 30 and 35 percent of its stake in the company to the public.

The company is currently 51 percent owned by the government and 49 percent owned by employees and the management.

The proceeds from the IPO are targeted to reach Rp 1.5 trillion (US$159 million).

The company has appointed Danareksa Sekuritas and DBS Securities to be underwriters to oversee the IPO.

PP posted a net profit of Rp 121.6 billion in 2008, about 30.78 percent higher than a year earlier.

Its sales also rose 22.2 percent to Rp 3.93 trillion in 2008.

Its net profits stood at Rp 28 billion in the first half of this year.

For the full year, the company has targeted a Rp 150 billion profit.

Mustafa said the IPO was one of the options to net fresh funds in order to boost the company's cash flow and operations.

In addition to PP, a planned IPO of three state plantation companies PTPN I, PTPN IV and PTPN VII this year is also likely to face delays and will instead be carried out in the first semester of next year.

The three companies have been prepared for an IPO since 2007.