State Plantation Holding Company to Launch Oct. 2

The Jakarta Post, Jakarta Darma Bakti Tambunan Tassia Sipahutar Business | Fri, September 26 2014 The government will inaugurate next week state company PT Perkebunan Nasional (PTPN) III as the holding firm for the plantation sector, dealing with 13 other plantation companies across the country. The Oct. 2 inauguration will make the Medan-based PTPN III, which produces crude palm oil and rubber, one of the biggest plantation companies in terms of assets in the Asian region. State-Owned Enterprises (SOE) Minister Dahlan Iskan said on Thursday that the launch would take place in Surabaya, East Java, during the ministry’s next coordination meeting. “Oct. 1 will mark the opening day of the holding company’s balance sheet. That is how we will determine the beginning of the accounting system,” he told reporters. PTPN III will likely be renamed following its inauguration as the holding firm. “We may change the name to Perkebunan Indonesia, similar to Semen Indonesia,” he added. Semen Indonesia is a state holding company that manages several cement firms. Prior to its conversion to a holding firm, Semen Indonesia was named Semen Gresik. No additional capital will be injected by the government into PTPN III, according to Dahlan. The capital will instead come from the plantation firms themselves as 90 percent of the government’s shares in all those firms will be transferred to PTPN III while the remaining 10 percent will remain in the firms. The ministry’s deputy minister for primary industry Muhammad Zamkani said it was waiting for the official capital valuation of the holding firm from the Finance Ministry. However, it is estimated that PTPN III will have more than Rp 9.86 trillion (US$822.83 million) in capital after the share transfer and, in terms of assets, the combined assets figure will exceed Rp 70 trillion. The government has been working on the plan to establish a plantation holding company for more than 12 years and President Susilo Bambang Yudhoyono only recently issued a government regulation. “Now that the regulation is out, we can speed things up. Hopefully the holding company will be fully realized before year-end,” he said. At present, the 14 plantation firms cover a wide variety of sectors, such as palm oil, rubber, cacao, tea, coffee and sugar cane. The SOE Ministry’s 2014 financial projection report shows that the total revenues generated from the plantation sector are estimated to reach Rp 53.51 trillion, up 26.9 percent from 2013. The net profit target is set at Rp 3.18 trillion, almost double from last year. When contacted, PTPN III corporate secretary Ali Imran declined to comment on the holding plan, saying that he had not been officially informed of it. Meanwhile, Dahlan has once again reiterated the possibility of a plantation firm going public after the holding company is established. Of all the firms, he said, PTPN VII was most ready to go public. The Bandar Lampung-based company now manages the production of rubber, palm oil, tea and sugar cane. Its 2013 annual report reveals that it booked Rp 4.62 trillion in revenue, but posted only Rp 78.65 billion in net profit, triggered by falling prices in the commodity sector. --------------------------------------------------------- “Now that the regulation is out, we can speed things up. Hopefully the holding company will be fully realized before year-end.”