UT suspends plan of selling Pamapersada shares

Publicly listed heavy equipment maker PT United Tractors (UT) has suspended its plan of selling a portion of shares of its wholly owned mining contractor PT Pamapersada Nusantara, Bisnis Indonesia daily reported on Monday.

UT had judged that the current stock market condition was not conducive for it to sell Pamapersada shares, the newspaper quoted a source as saying.

?Moreover, Pamapersada is UT?s jewel so that it decided to keep its shares,? the source added.

UT had planned to divest in 2001 a portion of Pamapersada shares through initial public offering (IPO) on the Jakarta Stock Exchange. IPO proceeds would be used for investment in heavy equipment, increasing UT?s working capital and repaying its debts of more than US$260 million.

Due to last year?s unfavorable market, UT made new plans to sell Pamapersada shares in 2002.

The source told Bisnis Indonesia UT would use funds to be derived from the sale of its 60 percent stake in East Kalimantan-based coal-mining firm PT Berau Coal. But UT officials said recently they might cancel their plan of selling Berau shares this year if their price was not favorable.

UT said earlier during the first quarter of 2002 booked a net earning of Rp 776.88 billion (US$=Rp8,860), much higher than previous year?s quarter of Rp 632.12 billion.

Pamapersada recorded 7 million tons of coal production for its principals during the first quarter of 2002, compared with 5.4 million tons from the previous year?s corresponding period. (*)