Medco plans to increase 'free float' shares in JSX

Publicly listed energy company PT Medco Energy International plans to increase the number of shares available for public investors in order to improve the liquidity of the company?s share trading in the Jakarta Stock Exchange, Bisnis Indonesia reported on Monday.

Medco?s financial director Sugiharto said that increasing the number of free-float shares (stocks that could purchased by the investing public) was needed to ensure that the share trading would be able to reflect the actual condition of the company.

"The current price of Medco?s shares have not yet reflected the real condition of the company," he said, adding that the company would issue more free-float shares when the price reached the Rp 2,075 or at the price level when PTTEP of Thailand purchased the company?s shares some time ago.

According to Sugiharto, the current price of Rp 1,400 is still too low and is still far from showing the company?s fundamentals.

The number of Medco?s shares which were held by public investors reached about 12 percent before the company carried out a buy-back program early last year to strengthen the share price. The buy back reduced the number of shares held by the public to only 5.3 percent at present.

Sugiharto said that the shares bought through the buyback program reached about 6.7 percent of the total shares. "They are now kept as the company?s treasury stocks and will be released again to the public when the price reached the minimal level of Rp 2,075.

New Link Energy Resources which include PTTEP and Medco founders hold 85 percent of Medco shares. Several companies affiliated to Medco hold another 2.5 percent. (*)