Wijaya Karya to be privatized through IPO

The state-owned construction and engineering company PT Wijaya Karya is scheduled to float up to 30% of its shares through initial public offering (IPO) in June. The company is expecting to get Rp600 billion from the IPO and would use the proceeds to expand its business and participate in electricity projects.

Government seems to follow the previous admnistration's decision to float construction and engineering company PT Adhi Karya Tbk.

According to its financial report published late last month, Wijaya Karya reported net revenue of Rp2.6 trillion or around US$300 million, increased from Rp2.47 trillion in 2004. But the company's net profit slightly reduced from Rp71 billion to Rp68 billion.

Besides these two companies, the state also own another construction companies like PT Hutama Karya, PT Waskita Karya, PT Nindya Karya, PT Istaka Karya, and PT Pembangunan Perumahan.

Waskita booked net revenue of Rp2.64 trillion last year, increased significantly from Rp2 trillion in 2004. Pembangunan Perumahan also recorded impressive growth of revenue from Rp1.68 trillion to Rp2.25 trillion and net profit growth from Rp54 billion to Rp67 billion.

Two years ago, Megawati administration launched the initiative to merge these state-owned construction companies. The new administration announced the plan to merge nine construction companies into three. But no progress has been made so far.

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