Indonesian Election: Opposition Promises Buy-back Indosat
PT Indosat Tbk

JAKARTA (TheInsiderStories) – Indonesia candidate for opposition vice-president Sandiaga Salahuddin Uno is determined to buy back the shares of PT Indosat Tbk (IDX ISAT), which is currently controlled by the Qatar telecommunications company because it was sold by the Indonesian government in 2003. This effort was made to perfect the National Integration System.

According to Uno, this is possible because, in one of the sales and purchase agreement clauses, there was a government agreement to buy back the shares in Indosat.

Referring to the Indonesia Stock Exchange data, the Indonesian government currently holds 14.29 per cent of ISAT shares while the majority is controlled by Ooredoo Asia Pte Ltd as much as 65 per cent. The remaining public shares amounted to 20.71 per cent.

Efforts to repurchase Indosat were the promise of President Joko Widodo in 2014 which until now has not been fulfilled. In the second debate of the 2019 president in February, Widodo again promised the same thing.

“Actually Widodo’s idea to buy back Indosat is good and under Subianto-Uno we will realize it. As long as it fails because it is not serious,” Uno said in Jakarta, Wednesday (03/20).

He said that the effort to buy back Indosat shares was a strategy to integrate community data in Indonesia. The strategy, he continued, was called the big push strategy. According to him, the electronic identity card integration system requires data that is now controlled by Indosat.

“One of the things we want to push is the electronic identity card, but we also have to master the data. We will talk to Qatar about how collaboration can be done so that Indonesia has data sovereignty,” he added.

The use of big data can actually be escorted and controlled by companies such as Telkomsel. If the stock buyback is successful, he continued, the data centre will be in Indonesia.

“If Telkomsel and Indosat are controlled by the government, 80 per cent of the public data is held by us. At present the majority of Indosat’s shares are still held by Qatar,” he explained.

In this way, Uno said that a job creation program with a big push strategy could be implemented. Because employment industrialization requires mastery of data.

In a different place, PT Indosat Managing Director Chris Kanter said, currently it is not the right time if Indonesia wants a buyback. He explained when Qatari investors bought Indosat shares from the government the value of the company’s market capitalization was around the US $ 3.3 billion, while currently, it dropped to less than $ 1 billion, so it was impossible for the investor to sell in a loss position.

Ooredoo is also ambitious to become the largest operator in the world. The Qatar company wants to develop Indosat because around 40% of its customers come from Indosat. “Indosat customers are 40 per cent of all groups spread across 11 countries. So, logically, he is not in the appetite to sell, let alone sell in a loss,” he said.

Kanter added that actually the government through the Minister of State-Owned Enterprises Rini Soemarno had been facilitated some time ago to meet with Qatar investors to convey their intention to repurchase Indosat Ooredoo, but Qatar did not have a plan to sell.

On the contrary, at present, they are actually agreeing to companies to massively increase the value of the capital expenditure to be able to grow faster in the future of $ 2 billion for 3 years.

As is known, the Megawati Soekarnoputri government sold Indosat in 2002 on the grounds of Indonesia’s economic crisis. Since then, a lot of criticism has been directed at him, one of them by the former Soekarnoputri era directorate general of tax, Fuad Bawazier.

He said the president’s decision to sell Indosat as a big mistake and deserved to be investigated was that when Indosat was included in the five companies that gave the biggest tax to the country. “The economy was not a crisis at the time. After Indosat was sold, taxes were lost. The profits were enjoyed abroad,” he added.

He considered, around 2002, Indonesia’s economic growth improved and was not in a crisis that required the sale of Indosat to cover state spending. As a result of this sale, according to him, the state lost many times, even today.

Written by Lexy Nantu, Email: lexy@theinsiderstories.com