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Medco Power to have IPO
Private power producer PT Medco Power Indonesia, part of the Saratoga Group cofounded by businessmen Edwin Soeryadjaya and Sandiaga Uno, says it is preparing to go public either by year-end or in mid-2015 in an effort to raise funds for business expansion
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rivate power producer PT Medco Power Indonesia, part of the Saratoga Group cofounded by businessmen Edwin Soeryadjaya and Sandiaga Uno, says it is preparing to go public either by year-end or in mid-2015 in an effort to raise funds for business expansion.
Medco president director Fazil E. Alfitri said on Wednesday that the company was looking at the possibility of raising more than US$200 million from an initial public offering (IPO).
'We need around $1.3 billion to finance our projects up until 2017. We hope to generate some of it from the IPO,' he said.
Fazil said that Medco, which is 51 percent owned by Saratoga through PT Saratoga Power and 49 percent by Medco Group, is currently concentrating on various projects, such as a geothermal power plant on Mount Ijen, East Java.
The 2 x 55 megawatt plant is estimated to cost $450 million. 'Our equity portion for that project will reach around $100 million and we will probably look for a strategic foreign partner to help us,' he said.
According to Fazil, the company must come up with all the necessary funding for the Ijen project in 2015 because it would begin drilling very soon. Ijen is expected to provide electricity for the Bali and Java areas from 2018.
Meanwhile, another Saratoga unit, oil refinery firm PT Tri Wahana Universal (TWU), is also in the process of going public, according to Saratoga Investama Sedaya chief financial officer Jerry Ngo.
Jerry said that TWU ' in which publicly listed Saratoga Investama Sedaya (SRTG) has a 47.5 percent stake through PT Wana Bhakti Sukses Mineral ' would meet all the requirements to undergo an IPO within the next two to three years.
'At the moment, it has a production capacity of 18,000 bpd [barrels per day]. When its capacity reaches 50,000 bpd, it will be ready for the IPO in terms of size and capacity,' he said.
Data from Saratoga Investama Sedaya's financial report shows that revenue from its oil refinery business reached Rp 1.55 trillion (US$134.43 million) from January to March 2014, almost three times higher than in the same period in 2013.
Revenue from the business eventually made up more than 98 percent of Saratoga Investama Sedaya's total revenues in the first quarter.
