Monday, November 28, 2005

Bakrie Telecom launch IPO

Today, PT Bakrie Telecom, a unit of the listed diversified group PT Bakrie & Brothers, starts its campaign to float some of its shares in the capital market.
The company has named PT Danatama Makmur as the underwriter for the listed share. Bakrie rolls out the initial public offering (IPO) of 5.5 billion shares at the price range of Rp105 to Rp115 per shares.
Most (90%) the fund will be used to finance the expansion of networks while the remaining for working capital.
The company is 71.2% owned by Bakrie & Brothers, CMA Fund Management Ltd (affiliation of Bakrie family) 21.37%, Richweb Investment 2.94%, and Bakrie Communications 4.49%. After the IPO, public investors would control 29.29% shares while Bakrie & Brothers keep the majority of 50.35%.
As of September 2005, the company booked net loss of Rp111.95 billion (US$12 million), reduced from Rp297 billion loss it booked in 12 months of 2004.
Bakrie Telecom has two main services, Ratelindo and Esia. Ratelindo is a fixed wireless access service using E-TDMA technology from Hughes Network System with operations in three provinces (Jakarta, Banten, and West Java). Meanwhile Esia is a CDMA-based fixed wireless service.
While Esia has been tipped as the company's future with heavy expenses in promotion, most of revenues (66%) still come form Ratelindo. Total customers under both services are 348,392, far below the market leaders Telkom and Indosat.

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