PT Wijaya Karya Tbk (IDX: WIKA) plans to divest 15 percent shares of Belawan Container Terminal in Medan, North Sumatera, in this year - Photo by the Company

JAKARTA (TheInsiderStories) – The state contractor firm, PT Wijaya Karya Tbk (IDX: WIKA) plans to divest 15 percent shares of Belawan Container Terminal in Medan, North Sumatera, in this year, the management announced yesterday. The funds from the share sales will be used for business expansion.

The company managed the port together with PT Prima Terminal Peti Kemas, PT Pelabuhan Indonesi I, and PT Hutama Karya since 2013. Beside Belawan port, said the spokesman, Mahendra Vijaya, the issuer is continuing to review a number of assets that can be divesting for asset recycling.

As for toll assets, he continued, the divestment plan will be carried out after construction is completed. Part of the funds, will uses by Wijaya Karya to finances 2021′ capital expenditure with worth of Rp3.04 trillion (US$217.14 million). the company will allocated Rp119 billion for existing projects, Rp2.13 trillion for capital injections of its units, and Rp800.82 billion for expansion.

He explained part of the funds use to support the ongoing projects like the Kunciran – Cengkareng toll road, the Balikpapan – Samarinda toll road, and the Semarang Demak toll road. Other projects to completed in this year are power plants. The builder owned 15 percent at the portfolios. As for toll road assets, the divestment plan will be carried out after the construction is complete.

While, its subsidiary PT Wika Realty, plans to take the floor on the Indonesia Stock Exchange in 2022, after the process of hospitality holding company done. The unit was appointed by the state own enterprises ministry as the anchor hotel chain owned by the government and managed around 22 hotels owned by four other state firms, such as PT Garuda Indonesia Tbk (IDX: GIAA), PT Hotel Indonesia Natour, PT Pertamina, PT Pegadaian, and Wijaya Karya.

In this holding process, the constructor will maintain its ownership in the range of 70 – 75 percent. Then, after the initial public offering, the parent still maintains majority ownership around 55 percent. Based on the planned, the revenues from the new holding will contributes around 10 – 15 percent from previous only 5 – 6 percent of the total income.

Currently, there are several overseas projects that have just been worked on by the constructor in the Philippines, Taiwan and the Democratic Republic of Congo with total values over than Rp2 trillion. Wijaya Karya was appointed as the contractor. The company also working on several projects, including a civil housing project in Algeria. In addition, the builder is also received a renovation project for the Nigerian Presidential Palace.

In Indonesia, the issuer has been assigned by the government to build several national strategic infrastructure projects such as 16 dams, toll roads for the Serang – Panimbang (Banten) section and Cengkareng – Kunciran toll road. Others are the Fast Train project, Mempawah port, and power plant projects.

US$1: Rp14,000

Written by Editorial Staff, Email: theinsiderstories@gmail.com