Chandra Asri to spin-off jetty operations into a separate unit

JAKARTA: PT Chandra Asri Petrochemical Tbk's shareholders approved the establishment of a new subsidiary that will engage in managing sea port terminals and other port facilities, a move taken to comply with the existing laws.Chandra Asri, as a petrochemical manufacturer, has been operating a jetty in its plant in Banten. But the laws require that any party doing sea port or jetty operations -- thus serving other parties -- to be a stand-alone company, said Chandra Asris Director Suryandi.This had prompted Chandra Asri to spin-off its jetty operations into a separate busines unit, he added.Total investment for jetty business unit is less that US$5 million. Such funding will come from internal fund.The establishment of this new subsidiary will enable other industries particularly around Chandra Asri plant to use the port facility.Besides strengthening its business line, it will also support the companys revenue going forward. However, he declined to mention how much revenue is expected from the jetty business.The establishment of this separate unit is expected to complete by the end of this month. There is also possibility that we will also manage other ports but it must be approved by the Transport Ministry, Suryandi said. The shareholders meeting also approved the use of 83.54% of its last year's net income, or IDR290.94 billion, as retained earnings to finance the companys business activity.The remaining IDR10 billion (2.87%) will be earmarked as reserve and IDR47.34 billion (13.59%), or IDR65 per share, has been paid out to the shareholders as dividends on December 1, 2010.New sharesMeanwhile, the companys rights issue plan is postponed because the market is still in uncertain conditions.Greeks debt issue is still unclear, US economy doesnt show any improvement and China is tightening its credit, which will eventually slow down its economy, Suryandi added.The companys road show in London (England), US and Singapore shows that investor tends to wait and see in responding the rights issue plan.He believes the postponement in releasing 827.87 million new shares or 27% of total shares distributed by the company will not disrupt its expansion plan to build butadiene plant, which will cost more than US$110 million. (T06/NOM)