TheJakartaPost

Please Update your browser

Your browser is out of date, and may not be compatible with our website. A list of the most popular web browsers can be found below.
Just click on the icons to get to the download page.

Jakarta Post

Investors yellow cards Bakrieland Development management

Anton Hermansyah (The Jakarta Post)
Jakarta
Fri, June 22, 2018

Share This Article

Change Size

Investors yellow cards Bakrieland Development management Investors show their displeasure by waving yellow cards at Bakrieland Developmentā€™s management in Jakarta on Friday. (JP/Anton Hermansyah)

I

nvestors gave PT Bakrieland Development’s management a "yellow card" after they rejected the company's plan to make a reverse stock split.

The company wants a 10:1 ratio, which means that 10 stocks will be converted into one. With the split, the price will balloon from Rp 50 (36 US cents) per stock to Rp 500.

Hidayat, one of the retail investors, said the split was useless and harmed retail investors because the price would drop again as experienced by other Bakrie family-owned companies.

"PT Energi Mega Persada’s price dropped by 77 percent three months after the July 2017 reverse stock split, PT Bakrie Sumatra Plantations is now less than half the price after the February 2017 reverse stock split and PT Bakrie & Brothers was suspended after an 86 percent drop," he said in Jakarta.

Bakrieland president director Ambono Janurianto said the reverse stock split plan was the part of company's debt restructuring strategy.

He added that to restructure some of the debt, the company obtained a Rp 500 billion loan from investment company PT Geo Link Indonesia, which was secured by Bakrieland’s stock ownership in PT Graha Andrasentra Propertindo. Bakrieland owns 38.76 percent of Graha Andrasentra Propertindo through its subsidiary PT Surya Global Nusantara.

Bakrieland also issued 2.52 billion stock warrants to its creditors related to the restructuring. If exercised, one warrant can be converted into 10 stocks at a price of Rp 100 per stock.

"Our creditor wanted the price of the stock at a marketable level, that is why we have to implement the reverse stock split," Ambono said.

The Rp 50 per stock price, according to an Indonesia Stock Exchange (IDX) rule, is the lowest price for stock on the regular market.

For the most part, after reaching the Rp 50 floor price, stocks are unable to bounce back because investors do not want to bid it up. (evi)

 

{

Your Opinion Matters

Share your experiences, suggestions, and any issues you've encountered on The Jakarta Post. We're here to listen.

Enter at least 30 characters
0 / 30

Thank You

Thank you for sharing your thoughts. We appreciate your feedback.