Garuda to go public in first quarter

Banda Aceh – State Enterprises Minister Mustafa Abubakar said here on Saturday PT Garuda Indonesia would go public in the first quarter this year.

“Let us pray it will be warmly welcomed by investors so that the target of shares to be sold will be met,” he said at the launching of an environment program held by the state-owned airline company in cooperation with International Leuser Foundation (YLI) in Aceh.

He said PT Garuda would sell 25 percent of its shares to the public to raise Rp2.5 trillion to strengthen its capital.

Mustafa expressed his appreciation to the company that had been able to achieve a four-star ranking or one grade lower for the company to get the world`s highest ranking.

“We hope PT Garuda which is under the supervision of the office of the state enterprise minister will be able to achieve the five-star status so that the public listing program will be smooth,” he said at the event which was also attended by Garuda president director Emirsyah Satar and Aceh governor Irwandi Yusuf.

PT Garuda Indonesia is optimistic the initial public offering could be realized in the first semester this year.

“Right now preparations are already being done including selecting the underwriters,” he said.Emirsyah meanwhile said the IPO plan was part of the company`s restructuring program to improve its performance.

The proceeds from the IPO are expected to reach US$300 million and will be used to finance additional fleets, refurbishment as well as improving services,” he said.

He said the result of the IPO would be dependable upon market conditions. “We will adapt it to the domestic capital market conditions,” he said.

Emirsyah said until 2014 the number of the company`s fleets would be increased to 116 units from currently 67 units. The increase in the number of fleets will be followed by a hike in routes to serve and flight frequencies to reach 3,000 flights per week from currently around 1,700 flights.