July 17, 2008

China’s Hong Kong, Singaporean Investors Eye Shares of Indonesian Steel Company

China's Hong Kong, Singaporean investors eye shares of Indonesian steel company

JAKARTA, July 16 (Xinhua) -- Investors from China's Hong Kong and Singapore are interested in buying shares of Indonesian largest steel producer of Krakatau Steel Inc., the company's Director Fazwar Bujang said here Wednesday.

Indonesian is to sale 35 percent of the company's shares at the second semester this year to get funds to finance technology to boost production capacity of the company from 2.3 to 7 million tones per year to meet the growing domestic demand.

The director said that the company has completed its road show to Singapore and Hong Kong recently to meet with the investors there.

Bujang said that the company was open for the domestic and foreign investors. "The Krakatau Steel can accept domestic and foreign investors. The fact that recently the foreign investors have dominated our capital market," he said.

The director said that the company was targeted for the initial public offering (IPO) in October this year.

Bujang said that the split of the share between domestic and foreign investors would be determined further.

Indonesian State-owned Enterprises Minister Sofyan Djalil said that currently the permitting for the IPO had been processed in the parliament.

Currently, Indonesia imports about 6 million tons steel a year to meet the domestic steel demand of about 7 million tones per year, according to the country's investment board.

Last year, Krakatau Steel Inc., posted a net profit of around 370 billion rupiah (some 40.66 million U.S. dollars). In the first quarter of 2008 alone, the figure already reached 400 billion rupiah (43.96 million U.S. dollars), according to the company.

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