Ministry to repackage SOEs to make them profitable

The State-Owned Enterprises Ministry has produced a blueprint for grouping together and restructuring under-performing state enterprises to make them more profitable, a senior official said on Sunday.
“We have divided up the companies based on their business types and have put them into groups,” deputy to the SOE minister for restructuring and planning Pandu Djananto told The Jakarta Post over the phone.
He said that state-owned forestry company Perum Perhutani had been appointed by the ministry to lead a holding company of other state owned forestry companies. Perhutani, which manages forests in Java, will oversee forestry firms PT Inhutani I, II, III, IV and V, which manage forests outside Java.
Perhutani was able to book more than Rp 200 billion (US$23.41 million) in profits last year, while the other firms only recorded total profits of Rp 10 billion.
The plan would be materialized once a holding company for state plantations had been established later this year. Also still in the pipeline are plans to form holdings for SOEs in the pharmaceuticals and construction sectors.
Meanwhile, fertilizer maker PT Pupuk Sriwijaya has been appointed as the holding company overseeing other fertilizer makers PT Petrokimia Gresik, PT Pupuk Kujang, PT Pupuk Kalimantan Timur, PT Pupuk Iskandar Muda, and EPC firm PT Rekayasa Industri.
Cement maker PT Semen Gresik is now overseeing PT Semen Andalas, PT Semen Baturaja, PT Semen Bosowa, and PT Semen Kupang.
However, Pandu said, strategic industries, including aircraft maker PT Dirgantara Indonesia; ship maker PT PAL and arms maker PT Pindad, would not be merged with holding companies.
Earlier on Oct. 32, SOE Minister Dahlan Iskan instructed the Asset Management Company (PT PPA) to manage under-performing BUMN companies.
Dahlan said that currently SOEs had a total of Rp 2,500 trillion of assets, and most of them did not turn profits and were burdens on their holding companies.
He choose PPA to execute the task because 70 percent of the firm’s activities was only helping restructuring and transforming ailing SOEs. “I have discussed this with PPA directors whether the company has enough energy, capacity and funds to solve problems in ailing state-owned enterprises that will not become huge firms anyway,” he said.
He said that the SOEs’ combined performance was bad because they could only make Rp 100 trillion in profit and Rp 28 trillion in dividends despite its huge assets.
Hakim Polim, PPA vice president and communication, told the Post that the company still did not have information on the under-performingSOEs.
The government aims to reduce the number of SOEs from 141 to 78.
Tanggal         : Senin, 07 November 2011, Hal. 13
Penulis           : –
TONE              : POSITIVE