Bapepam has yet to approve Bumi Modern's rights issue plan

Head of the Stock Exchange Supervisory Board (Bapepam) Herwidayatmo said on Thursday his office had yet to approve the plan of property company PT Bumi Modern to hold rights issue to raise Rp 9.3 trillion for the acquisition of Yemen oil company Gallo Oil, Kompas reported.

Both Bumi Modern, which is listed in Jakarta, and Gallo Oil are subsidiaries of Indonesian conglomerate Bakrie Group.

Bumi Modern is scheduled to hold a shareholders meeting today (Friday) to ask the approval of the shareholders for the rights issue plan.

Analysts speculated that Bakrie wanted to use the funds raised from the rights issue to pay off its debt, while the value of Gallo's shares have been marked up. (*)