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NESTLE TO INVEST US$ 390 MILLION IN INDONESIA. Swiss beverage giant Nestle SA, through Indonesian subsidiary, PT Nestle Indonesia, plans to increase investment by US$ 390 million in five years until 2015. Around US$ 200 million of the fund will be used to build a factory in Karawang and expansion of its factory in East Java to cost US$ 190 million. President of PT Nestle Indonesia Arshad Chaudhry said Indonesia would become the production base for Nestle's beverages in Southeast Asia. "The factory in Karawang would be able to produce processed milk with a capacity of 65,000 tons per year," said Arshad. The factory will provide jobs for 600 workers. The construction of the fourth factory of Nestle in Indonesia is expected to be completed in 2013. The factory, to be built over a 28 hectare plot of land, will produce various products such as baby porridge and powdered milk. Nestle also plans to expand the production capacity of its factory in East Java from 650 tons to 1,000 tons per day. With the expansion Nestle will have 33,000 workers.
PETROKIMIA GRESIK TO BUILD NEW FACTORIES TO COST US$ 1.1 BILLION. PT Petrokimia Gresik, a state fertilizer producing company, will build two new factories   and revamp a factory with an investment of US$ 1.1 billion starting this year. The new factories will increase the production capacity of the state company. President of PT Petrokimia Gresik Hidayak Nyakman said the three factories will include one to produce urea ammonia, to cost US$ 700 million, one to produce phosphoric acid to cost US$ 200 million and revamping of its sulfuric acid and phosphoric acid factory to cost US$200 million. The new phosphoric acid project is to be built in cooperation with Jordan Phosphate Mine Co Plc, a producer of phosphoric rock. Kimia Gresik will also build limestone calcination factory with a capacity of 60,000 tons per year and expansion of a special port in Gresik to cost Rp500 billion. He said many projects will be implemented in 2011 and would take a number of years for completion.  In 2011, Petrokimia Gresik reported Rp 1.12 trillion in un-audited profit or an increase of 39.8% from Rp 801 billion in the previous year.  Sales and financial performance improved in 2011 and in 2012, the company hopes to post Rp 1.39 trillion in net profit, he said.

LG INTERNATIONAL TO BUILD PETROCHEMICAL FACTORY IN PAPUA TO COST US$ 3 BILLION. LG International Corp, a trading firm from South Korea, plans to build a petrochemical plant in Tangguh, Papua Barat with an investment of US$ 3 billion (Rp 27.3 trillion). The subsidiary of the LG Group will team up with PT Duta Firza (Indonesia) in a joint venture company that would implement the project. Chief Executive Officer of Duta Firza, Firlie Gandinduto, said LG International Corp had signed a head of agreement (HoA) with Duta Firza in Seoul. LG Internasional and Duta Firza agreed to cooperate in pre-planning and pre-feasibility study of the project including in the feasibility of gas supply from Tangguh, project financing, marketing of petrochemicals and the assignment of EPC contractors. Construction of the project is expected to start in mid 2014 and trial operation is expected in the last quarter of 2017 or early 2018.LG International Corporation is the third company from South Korea after Lotte Group and Honam Petrochemical Corp, planning investment in petrochemical industry in Indonesia.

BAKRIE TEAMS UP WITH SAMPOERNA IN TELECOMMUNICATIONS BUSINESS. PT Bakrie Telecom Tbk (BTEL) and PT Sampoerna Telekomunikasi Indonesia (STI). Merger has agreed on merger between their businesses in telecommunication sector. The merger would be made through share swap the two operators of CDMA-based telecommunication service have signed a conditional sale and purchase agreement. President of Bakrie Telecom Anindya Bakrie said in the process of merger, Bakrie Telecom will acquire 35% of Sampoerna Telekomunikasi Indonesia.And in three years Bakrie Telekomunikasi will wholly take over Sampoerna Telekomunikasi Indonesia. In return, Sampoerna Strategic will become a shareholder of Bakrie Telecom. Currently Sampoerna Telekomunikasi Indonesia is owned by Sampoerna Strategic and Polaris.  Sampoerna will also have a stake in Bakrie Telecom through private placement and Bakrie Telecom will release rights shares. Anindya said the two companies will integrate business operation under the management of Bakrie Telecom. The purpose is to promote cellular service and take advantage of the rapid growth of telecommunications business. He said the frequency of 7.5 MHz of Sampoerna Telekomunikasi Indonesia in the 450 MHz band will significantly increase the capacity of Bakrie Telecom, the operator of Esia cellular phone service.

CARREFOUR CONTRIBUTES RP15 TRILLION TO CT CORPORATION'S INCOME. The owner of CT Corporation, Chairul Tanjung, said PT Carrefour Indonesia accounted for 60% of the total income of CT Corporation in 2011 the income of CT Corporation, formerly known with the name of Para Group, reached Rp 25 trillion in 2011. Chairul said every two years, CT Corporation recorded a two-fold increase in income or around 40% a year. CT Corporation has three subsidiaries Mega Corp, Trans Corp, and CT Global Resources - operating in the financial media, retail, entertainment, life style and natural resources sectors. Previously Trans Corp, of the Para Group, acquired 40% stake in PT Carrefour Indonesia making it the majority shareholder in the local unit of the French retail giant in April 2010.The Para Group paid more than US$ 300 million for the stake. Carrefour Indonesia has 79 outlets including 63 hypermarket outlets and 16 supermarkets in 22 cities all over the country.  In 2009, Carrefour Indonesia reported sales valued at Rp 11.7 trillion. Chairul said the second largest contributor to the income of CT Corporation is Trans Media accounting for 20% of the total income.

HOLCIM TO INVEST US$ 450 MILLION IN CEMENT PROJECT IN TUBAN. PT Holcim Indonesia Tbk, the country's third largest cement producer, will invest up to US$ 450 million in a new cement factory being built in the regency of Tuban, East Java. The new factory will have a production capacity of 1.7 million tons a year. The new factory will expand Holcim's production capacity by 15%. Currently Holcim has two factories one in Cilacap, Central Java and another in Narogong, Bogor, West Java  with a total  capacity of 8.3 million ton per year. Year. Relationship Management Director of PT Holcim Indonesia Tbk Rustle Setiawan said construction of the factory started in December, 2010 and it is to be completed in the last quarter of 2012. Holcim has the third largest share of cement market in the country after PT Semen Gresik Tbk and PT Indocement Tunggal Prakarsa Tbk. Its sales of cement and clinker reached 7.83 million tons in 2010 including 6.23 million tons sold on the domestic market and the rest exported. Holcim also sells reinforced concrete around 1.4 million m3. A year. Holcim has a 13.7% share of cement market in the country.

November 2011
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