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Astratel eyes power plants, new plantations

Conglomerate PT Astra International (ASII) subsidiaries, PT Astratel Nusantara and Jakarta listed PT Astra Agro Lestari (AALI), are preparing to expand their businesses by bidding for new projects and assessing acquisition possibilities.

At the moment, Astratel was expecting to complete agreements on joint ventures with European companies to bid for power plant projects, Astra International chief group treasury and investor relations officer Iwan Hadiantoro said on Wednesday.

“We are looking at a hydropower plant project in Sulawesi and a coal-fired power plant project in Kalimantan. Each of the power plants will have a capacity of 150 megawatts,” Iwan said.

“The hydropower plant project will cost roughly US$250 million while the coal-fired power plant will need around $200 million,” he added.

As a 100 percent owned subsidiary, Astratel is currently Astra’s arm on infrastructure and its related business. Earlier in January, Astratel along with fellow subsidiary PT Intertel Nusaperdana acquired a 100 percent stake in PT Pelabuhan Penajam Banua Taka, which runs a port operation business in East Kalimantan. Astratel also operates in toll roads. 

In 2011, Astratel acquired a 95 percent stake in PT Marga Hanurata Intrinsic (MHI), which holds a license to develop a 40.5-kilometer highway connecting Kertosono and Mojokerto in East Java. 

The toll road development requires Rp 3.5 trillion (US$339 million) in total investment.

“The toll road construction has reached about 70 percent and land clearance about 80 percent. We hope to complete the toll road later this year and have it in operation next year,” Iwan said.

Meanwhile, Astra’s subsidiary in the crude palm oil (CPO) business, Astra Agro, has expanded by acquiring a plantation area in the first half of the year, Astra Agro head of investor relations, Rudy Lumardjo, said. 

He, however, declined to reveal the size of the land.

“When looking for a new land, we prioritize areas close to one of our existing plantations. If it is far [from existing plantations], the size must be big enough for us to see the economic value, which is about 5,000 hectares, so we can build a factory with a processing capacity of 20 tons of fresh palm fruit per hour,” Rudy said.

Rudy added that the company’s expansion team was assessing opportunities for acquisitions, including a plantation area owned by PT Bakrie Sumatera Plantations (UNSP).

“We see all offerings and evaluate them. If the price is a match, we can consider them,” Rudy said, adding that Astra Agro, which is 79.68 percent owned by Astra International, expects to see a 5 to 10 percent increase in CPO production this year.

Meanwhile, Bakrie Sumatera is in the process of selling the assets of six subsidiaries, which are PT Jambi Agrowijaya, PT Eramitra Agrolestari, PT Trimitra Sumberperkasa, PT Multrada Multi Maju, PT Padang Bolak Jaya and PT Perjapin Prima, according to its financial report. 

The companies signed sales agreements with third parties on December 18, 2012, but have yet to close the deals. Bakrie Sumatra’s financial report for the first quarter also showed that the subsidiaries had received payment of $29.61 million for the assets.

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