The Ministry of State-Owned Enterprises (SOEs) is in a holding pattern, awaiting the transition to a new government before taking major corporate actions, including forming new holdings and launching initial public offerings (IPOs) of SOEs.
Arya Sinulingga, Special Staff to the Minister of SOEs, confirmed that these actions are on hold until the new administration is in place.
“The IPOs cannot be conducted before the transition to the new government. The merger of BUMN Karya (state-owned construction companies) is also awaiting the new administration, but we are hopeful it can be achieved this year,” Arya said on Tuesday, August 20, 2024.
He emphasized that although plans have been developed and are ready for execution, the change in government necessitates a delay.
Minister of SOEs, Erick Thohir, had laid the groundwork for these initiatives, and it is expected that the new minister, whoever that may be, will continue with these plans.
Optimism in several SOEs
Arya expressed optimism that the plans, including the formation of a holding company for BUMN Karya involving PT Hutama Karya and PT Waskita Karya (WSKT), can proceed smoothly, potentially as early as October.
The holding company is intended to streamline operations among BUMN Karya, allowing each to specialize in specific sectors, reducing internal competition, and improving financial health.
Under this consolidation, Waskita Karya would become a subsidiary of Hutama Karya.
“We are aiming for everything to be legally finalized by September,” Arya added, expressing confidence that the legal aspects would be resolved soon.
Earlier, it was announced that the holding company formation would help these construction SOEs avoid direct competition and focus on their strengths.
For example, PT PP is slated to merge with PT Wijaya Karya, focusing on port, airport, factory, and housing construction.
The planned merger between Hutama Karya and Waskita Karya will focus on toll road construction, non-toll road projects, institutional buildings, and commercial housing.
Additionally, there are plans to consolidate three other BUMN Karya − PT Nindya Karya, PT Brantas Abipraya, and PT Adhi Karya − into a single entity focusing on water resources and railway infrastructure.
Erick has acknowledged that while the groundwork for these mergers has been laid, the full implementation could take up to three years.
Nonetheless, he remains committed to pursuing these reforms, emphasizing the importance of these mergers for the future competitiveness of Indonesia’s state-owned enterprises.
As the government transition unfolds, the direction of these initiatives will become clearer, but for now, the SOEs’ corporate actions remain in a state of readiness, poised to proceed once the new government is in place.
