Oct 9, 2010

Krakatau Steel & ludicrous dual listing

Three lead underwriters and two global coordinator arrangers with Ministry of State-Owned Enterprises on last Friday have determined the price range of Indonesia's largest steel manufacturer PT Krakatau Steel's initial public offering at Rp800-Rp1,200 per share.
Krakatau Steel plans to offload 3.1 billion shares or 19.61% into the market during the IPO. Referring to the price range, the steel manufacturer will bag Rp2.48 trillion-Rp3.72 trillion.
For sure, there is no ludicrous intention to put Krakatau Steel, old-fashioned technology steel maker, on the list of New York Stock Exchange (NYSE), equals to Indonesia's largest telecommunication operator PT Telekomunikasi Indonesia Tbk (TLKM), that used to totter with Sarbanes Oxley requirements.
Prolonged controversy emerged for years to expel Telkom from Wall Street due to high cost listing fees and tough regulation requirements. Funny question arises how could Krakatau Steel to comply NYSE requirements?
SOE Ministry Secretary Mahmuddin Yasin said there is no plan and early talks to convey Krakatau Steel to Wall Street.
Bahana Securities, Danareksa Sekuritas, and Mandiri Sekuritas in collaboration with Credit Suisse and Deutsche Bank strive to convince investor that Krakatau Steel is something not to be neglected. The facts, upcoming rights issue from both state-banks Bank Negara Indonesia and Bank Mandiri sounds interesting to take part.
Krakatau Steel aims to meet potential investor in Singapore, Hong Kong, London, and US starting on October 13 2010.
The steel maker schedules initial trading at Indonesia Stock Exchange on November 10 2010 when Indonesia commemorates Heroes' Day.

Disclosure: No position at the stock mentioned above.

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