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tate-run diversified miner Aneka Tambang (Antam) has begun traveling around Asia to assess investor interest in its rights issue, worth up to Rp 5.3 trillion (US$359.9 million), despite not having appointed underwriters for the offering.

Antam corporate secretary Tri Hartono brushed off any concerns that his company was facing problems in getting underwriters, saying it had decided to appoint standby buyers only after the fixed price had been set.

'€œWe will determine the price later this month and then we will name underwriters to manage our rights issue,'€ he said, insisting that the company had no problems in preparing its equity offering. '€œWe are currently taking our international roadshow to Malaysia, Singapore and Hong Kong to promote the offering. We are confident that investors will welcome our rights issue.'€

The Indonesia Stock Exchange (IDX) questioned why Antam, which published its rights issuance prospectus late last month, had not included the names of its underwriters in the document and how the company would manage the possibility of its floated new shares being under-subscribed.

Publicly listed companies filing plans with the IDX to issue rights shares normally have their underwriters ready, and conduct their promotional roadshow with the appointed securities firm to assess investor interest in the shares, which will then be used to calculate a fixed price for the offering.

Antam will issue 14.12 billion new shares, which will be offered to existing shareholders during the period of Oct. 22 to 28. Its prospectus does not cite a specified price, only stating that the shares will be priced at between Rp 371 and Rp 535.

Antam said it might appoint the underwriters at least two days before the Oct. 8 shareholders meeting to secure approval for the offer.

Antam'€™s rights issue is part of the government'€™s state capital injection, with 37 state-owned enterprises under the State-Owned Enterprises (SOE) Ministry having been scheduled to receive a combined capital injection of Rp 31.52 trillion.

Antam will use the funds for a ferronickel smelter in Halmahera, North Maluku, which is expected to cost about $1.6 billion and will have the capacity to process 40,000 tons of ferronickel in nickel (TNi) a year.

The government, as the majority shareholder, has allocated Rp 3.5 trillion to purchase the new shares, as part of its capital injection.

William Surya Wijaya, an analyst from Asjaya Indosurya Securities, said the company might be required to do some extra work to promote its equity offering, especially given the current gloomy market for stocks and weak commodity prices.

'€œIt is rare for a company to publish a prospectus without naming its underwriters in the document. It is, however, understandable that the company might want to make its price as clear as possible to make sure the shares will be absorbed by the market, given its current condition,'€ William said.

'€œInvestors identify Antam with gold and with the prices of the commodity fluctuating somewhat, albeit stable in the longer term, the company'€™s offering might face some challenges especially amid such a bearish market.'€

Antam'€™s shares have plunged 55 percent so far this year, substantially underperforming the broader benchmark Jakarta Composite Index'€™s (JCI) 21 percent slump. The stocks slipped 5.5 percent on Monday, versus JCI'€™s 2.1 percent drop.