PGN’s IPO receives positive response from investors

The initial public offering (IPO) of the State-owned gas utility company PT Perusahaan Gas Negara (PGN) has received positive response from investors – both domestic and foreign – during its roadshow to several Indonesian cities as well as foreign countries, Bisnis Indonesia newspaper reported on Wednesday.

An investment banker who involved in the PGN’s IPO revealed to the Bisnis that local investors had expressed interest to purchase Rp 600 billion worth of PGN’s shares.

“From the domestic roadshow, there is an indication that local investors may invest up to Rp 600 billion on PGN’s IPO,” the banker said.

Meanwhile, Hong Kong investors may allocate up to US$57 million to PGN’s IPO and the result from the roadshow to the U.S. and Europe are not clear as the process is still going on, the banker said.

Government has decided to sell the 39 percent shares of PGN at a price of between Rp 1,300 and Rp 2,100 each through an IPO. The company is expected to fix the price on December 3.

The IPO is expected to raise between Rp 1.2 trillion and Rp 2 trillion in cash.

PGN said in its prospectus that it will sell up to 1.69 billion shares, of which 1.29 billion will be issued in the first stage. The remaining shares will be issued if the first batch is oversubscribed.

PGN has named state-owned PT Danareksa Sekuritas, Credit Suisse First Boston and ABN Amro Asia Securities as joint lead underwriters for the IPO.

The IPO will be open for subscription from Dec 8 to Dec 10, and the stock will be listed on the Jakarta and Surabaya stock exchanges on December 15. (*)