"If I were a president director of joint lead underwriters [JLU], I would rather lose my nationalism than leaving business and employees in trouble," a former investment banker told Insider Stories today.
The problem is the JLU, Bahana Securities, Danareksa Sekuritas, and Mandiri Sekuritas, of PT Garuda Indonesia Tbk (Persero) IPO, don't have enough boldness to say no when Minister of SOEs Mustafa Abubakar asked them to sell Garuda at higher valuation.
"No one at JLU had bravery to say as it is to Mustafa. Apparently, they were too dismayed if they will be displaced," the banker said.
In fact, Garuda had been listed at Indonesia Stock Exchange, the price had steeply dropped from the IPO level, and Bahana Securities has been secured with bailout financing worth Rp200 billion-Rp300 billion by Danareksa Sekuritas.
As quoted by Bisnis Indonesia on Saturday, Danareksa has friendly provided a 1 month-bailout financing to Bahana bacause it required cash to absorb unsold Garuda shares during IPO."If you hope Garuda to surpass Rp750 in 1 month, it is not an easy way. When GIAA-coded stocks show direction to Rp750, investors who are 'trapped' will dump Garuda, making it hard to recover. They may need 6 months-12 months to rebound," the banker said. Who will be the culprit on Garuda IPO messy? Please login or register to read the remaining story.
Disclosure: No position at the stock mentioned above.
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