JAKARTA (TheInsiderStories)—PT Wijaya Karya Realty (Wika Realty), a subsidiary of state-owned construction company PT Wijaya Karya (Persero) Tbk, seeks to raise US$172.83 million to US$229.63 million from an initial public offering scheduled in May.
The President Director of Wika Realty Agung Salladin said on Friday (27/04), as quoted by Bisnis Indonesia, that the company will release 12.51 billion shares, equivalent to 25 per cent of its total paid-up capital. The company has set its IPO price at Rp195-Rp255.
The firm plans to use 20 per cent of the IPO proceeds to help fund capital expenditures on the existing projects. Another 43 per cent will use for the land acquisition.
The company is working on 22 new projects and plan to work on seven more projects worth as much as Rp600 billion to Rp700 billion this year.
currently at the book building stage, the company expects to secure an effective statement from the Financial Service Authority by May 9, 2018, before listing its shares at the Stock Exchange by May 17, 2018.
The Wijaya Karya plans to inject Rp 1.44 trillion to Wika Realty to support the company’s growth in 2017-2021. The company’s shareholders approved the plan on this capital injection on 26 March 2018.
The purpose of this capital injection is for the land development in line with the company’s step that has signed a Business Cooperation Agreement (PKU) with PT Kereta Api Indonesia, to develop the land of Laswi owned by PT Kereta Api Indonesia (Persero).
Wika Realty has limited capital to implement the agreement, so that there is a need for the capital injection from the Shareholders in accordance with Wika Realty’s budget plan Wika in 2018 amounting to Rp1.58 trillion with the amount of the Company’s capital deposit portion of Rp1.44 trillion.