14 June 2022 (closed)
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PT Semen Baturaja Tbk, a state-owned cement producer, will offer 20 to 35 percent of its equity to the public when it conducts its initial public offering (IPO) on the Indonesia Stock Exchange in June or July 2013. Initially, the Indonesian cement company was planning to conduct the IPO in 2012 but disagreement within the House of Representatives (DPR) - the government institution that needs to approve the IPO - resulted in a temporary postponement.
The company appointed state-owned securities firms PT Bahana Securities, PT Mandiri Sekuritas and PT Danareksa Sekuritas as underwriters for the IPO.
The government will maintain its majority-stake in Semen Baturaja after its listing on the Indonesia stock exchange (IDX). The company aims to reap IDR 1 trillion (USD $103.1 million) from the IPO, proceeds of which will be used to expand Semen Baturaja's business through the establishment of a new factory to meet Indonesia's rising cement demand. The new factory will cost about IDR 2.5 trillion (USD $257.7 million) and will be financed through internal reserves (IDR 1 trillion), bank loans (IDR 500 billion), and proceeds from the IPO (IDR 1 trillion). The factory is scheduled to commence operations in 2017.
Currently, Semen Baturaja owns three cement factories in Palembang, Baturaja and Lampung (all on the island of Sumatra) with a total annual production capacity of 1.2 million tons of cement. The company's market is mainly Sumatra (South Sumatra, Lampung, Bengkulu and Jambi).
This year, the company expects a 20 percent increase in cement sales volume to 1.5 million tons, supported by the opening of a new cement mill in the second half of this year.
According to analysts as well as data from the Indonesian Cement Association (ASI), the country's cement consumption will increase significantly in the years ahead. Cement production in 2012 totaled 60.6 million tons, but this number is expected to increase to 78.5 million by 2016.