After repeated delays, state-owned housing company PT Pembangunan Perumahan (PP) said Wednesday that it was ready to sell 21.4 percent of its stake via an initial public offering (IPO) on Feb. 8.
PP finance director Tumiyana said in a public expose on Wednesday he was optimistic that the IPO plan would go ahead as scheduled.
He also said that he was expecting the Capital Market and Financial Institutions Supervisory Agency to issue an effective approval, as required for all IPOs, on Jan. 28.
The company first planned the IPO in 2008 but kept finding obstacles in the way, the latest being a pending government regulation.
PP operational director Kiswodarmawan said the company had retained its dividends in 2009 because “the government did not have the equity capital for PP’s business expansion”.
PP was previously 51 percent owned by the government and 49 percent owned by its employees. The government’s share later grew by 21.4 percent because of the retained dividends, combined with the voluntary transfer of shares from the employees.
“This had to be done because the House of Representatives, aside from letting us sell up to 30 percent of our shares, also required PP to remain a state enterprise after the IPO,” Kiswodarmawan told The Jakarta Post.
After the IPO, the government will still hold the most shares, or 51 percent, while the employees and management will retain 27.6 percent and the rest will go to the public.
Kiswodarmawan said that price of the company shares would be revealed after the conclusion of the book building process by the end of January.
The government had previously said that selling 30 percent of PP shares through an IPO would generate around Rp 1.5 trillion (US$161 million) in proceeds.
“We will use the proceeds generated from the IPO to invest in infrastructure, which is close to our core competence,” he said, adding that PP will seek to participate in development of toll roads and development of electricity infrastructure.
Tumiyana said PP would use 60 percent of the proceeds for business expansion and the remaining 40 percent for working capital.
PP posted a net profit of Rp 163 billion in 2009, about 34 percent higher than a year earlier, exceeding the company’s initial target of Rp 150 billion.
“We had an increase in net profits thanks to efficiency,” he said without elaborating.
