Davomas, Katarina face delisting: IDX

JAKARTA. The Indonesia Stock Exchange (IDX) may delist shares in cocoa producer PT Davomas Abadi (DAVO) and telecommunication equipment service provider PT Katarina Utama (RINA) after both firms failed to demonstrate healthy business operations.

Davomas, which is one of the main cocoa grinders in Indonesia, failed to pay coupons due in March this year on its debt papers amounting to US$135 million, to mature in 2014. The company restructured its debt in 2009 after failing to pay $13 million of interest on bonds leading creditors then to say it was in default, according to the financial statement.

Katarina’s Malaysian board is alleged to have embezzled some of the company’s Rp 33.6 billion (US$3.56 million) IPO proceeds. Katarina is also alleged to have overstated its assets.

“As long as they have revenue, they are still alive. Davomas could not show any earnings. If the situation remains unclear, there’s a possibility of entering the delisting process,” IDX director of corporate listing Hoesen told reporters. As for Katarina, the stock exchange is seeking notice of clear shareholder composition and ownership of the company.

“The bourse is trying to take firm action,” he added.

Listed companies must be going concerns, he said, referring to a company’s ability to make enough money to stay afloat or avoid bankruptcy. Hoesen called for executives of Davomas and Katarina to be cooperative in providing information to the stock exchange on how the companies will generate
revenue.

“There needs to be an internal decision process. We have to talk with the listing committee. If the last-chance offer receives no response, we will settle the matter accordingly,” he explained.

Shares in Davomas, floated on the IDX since 1994, have been suspended since March this year when the company announced its failure to pay its bond coupons. Stocks were trading at Rp 50 each.

No transactions have been seen on Katarina’s stocks since August 2010, one year after its IPO, according to stock exchange trading records.

“The shares could be sold through negotiations in the market. But, if the shares continue to be suspended, it won’t happen. It creates uncertainty for the public,” Hoesen said. The public owns about 20 percent of Davomas and almost 26 percent of Katarina.

In addition to the investing public, Katarina is 66.67 percent owned by PT Silver Mountaine and 7.41 percent by telecommunication infrastructure firm PT Media Intertel Graha.

Cocoa processor PT Uniflora Prima has delayed a plan to buy a 51.9 percent stake in Davomas from five shareholders — Hassocks Enterprises Ltd., Caterpillar Associates Ltd., Krigler Holdings Ltd., Polar Cap Investments Ltd., Templeton Assets Ltd. — due to financing issues.

Both Davomas and Katarina are no longer members of the Indonesian Publicly Listed Companies Association (AEI), because both companies have been inactive for a couple of years and their offices
cannot be contacted.

“The stock exchange is supposed to follow suit,” AEI chairman Airlangga Hartarto said in support of the IDX’s plan to delist Davomas and Katarin. (Esther Samboh/The Jakarta Post)