Modern electronics retailer PT Electronic City Indonesia is planning to raise funds from selling new shares to the public to support its expansion.
The company conveyed the plan to the Indonesia Stock Exchange (IDX) on Friday and has appointed PT Danareksa Sekuritas and Credit Suisse to be underwriters for the initial public offering (IPO).
Danareksa director Iman Hilmansyah said that the company expected to hold the IPO by June. “The new shares issued will be up to 25 percent [of enlarged capital],” Iman said.
He added that the company would use the funds raised from the issuance to expand its business by opening new stores.
Electronic City currently has 17 stores and 12 outlets in Greater Jakarta, Bali, Medan in North Sumatra, and in a number of cities across Central Java.
The company’s flagship store is located in the Sudirman Central Business District (SCBD) in Semanggi, South Jakarta. The store is also the company’s head office.
Founded in 2001, Electronic City claims to be the first modern retailer of electronic products in Indonesia. It boasts spacious stores selling various brands of cellular phones, computers, gadgets, office equipment and home appliances.
Electronic City also holds a number of shares in PT Danapati Abinaya Investama, which runs a local television station called Jaktv. According to information available on Jaktv’s website, Electronic City holds ownership in the company together with the Artha Graha Group and Jakarta-listed PT Mahaka Media.
According to Mahaka Media’s financial report, it currently holds a 50 percent stake in Jaktv. However, the company did not reveal the standing of its partners, which are Electronic City and Artha Graha, in Jaktv.
Electronic City said they expected to raise a substantial amount of money from its offering compared to previous IPOs this year, which have raised between Rp 72 billion (US$7.41 million) and Rp 855 billion, respectively. Iman declined to reveal the company’s target from the initial offering. “It is sizeable. The liquidity is good,” Iman said.
As many as seven companies have entered the bourse year to date. The total funds raised reached Rp 2.15 trillion.
A number of other companies are also planning to enter the bourse this year, including plantation company PT Austindo Nusantara Jaya; motorcycle distributor PT Mitra Pinasthika Mustika; investment company PT Saratoga Investama Sedaya; state-owned cement firm PT Semen Baturaja, and Siloam Hospitals.