ANALYSIS - Benakat & Elnusa Acquisition

Indonesia Finance

Wednesday, 23 June 2010 09:07

After purchasing a 24.6-percent stake in oil and gas services company PT Elnusa (ELSA), PT Benakat Petroleum Energy has so far yet to complete the acquisition of total 37.15 percent stake in Elnusa. Erry Firmansyah, commissioner of both Benakat and Elnusa, disclosed that some administrative issues had set back the acquisition.

Is it a complicated administrative issues? Benakat had in March 12 paid Rp 592.5 billion cash to PT Tridaya Esta (TDE) for 24.6 percent Elnusa stake. One of Benakat's shareholders funded that payment.

In a disclosure to stock exchange in March, Benakat said it will completed the acquisition of Elnusa stake on April 12. After missing the deadline, Benakat again said the further purchase of 12.55 percent Elnusa stake worth Rp 302.5 billion was extended to May 12. Unfortunately, the purchasing also did not happen both in May 12 and June 12.

Erry is now expecting the second stage of Elnusa stake purchase will be realized within next 2-4 weeks. Should it be easy to believe?

Erry did not expain the administrative issues in detail but as media has earlier reported Tridaya had put all its Elnusa's stakes as collateral for loans to its creditor, SINGAPORE-based oil and gas services firm Dharma Investments Pte Ltd.

The consortium of Saratoga Capital and Northstar Pacific Partners Ltd had also failed to acquire 37.15 percent of Elnusa stake in 2009 because some Elnusa stake was not 'free and clear' assets.

State oil and gas company PT Pertamina which owns 66.67 Elnusa stake also competed with the consortium but it failed due to offering lower price.

Erry said the loan transaction by putting stakes as collateral could run for three months to one year. Erry however said he does not know how big Tridaya's loan to Dharma Investments and how long the period for repaying the loan. Tridaya made loan to Dharma Investments in 16 September 2009.

Another source also said PT Indotambang Perkasa, one shareholder of Benakat, has not fully provided loan to Benakat as some Elnusa stake is not free and clear.

State securities firm PT Danareksa had also provided US$52 million loan to Tridaya in 1997. The loan had in October 1998 been converted to rupiah denomination (using exchange rate of Rp 7,900), or Rp 416.5 in total, following the wake of Asian financial crisis.

But, now, the case arises to surface as former state enterprises minister Laksama Sukardi had being sued for the alleged wrong-doing on Danareksa's debt restructuring.

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