Indonesia’s state-controlled construction company Adhi Karya is planning to conduct initial public offerings for two of its subsidiaries in the second half this year with a combined target to raise around Rp 4.5 trillion ($319.9 million), a top executive of the firm said on Monday.
“Both companies will sell around 30-35 per cent each of their enlarged capital,” Adhi Karya’s newly-appointed investment director Partha Sarathi said.
Adhi Commuter Properti (ACP), a transit-oriented property developer, plans to raise Rp 1.5 trillion ($106.6 million), while the building construction arm Adhi Persada Gedung (APG) is targeting to mop up Rp 3 trillion ($213.2 million) in the public market funding.
The company has appointed a consortium of underwriters including state-owned brokerage firms Mandiri Sekuritas and BNI Sekuritas.
The company intends to use the IPO proceeds to acquire lands and to build transit-oriented development properties such as malls and office buildings.around the Light Rail Transit area.
Adhi Karya is part of a consortium that is building a Light Rail Transit (LRT) project, connecting the four cities in Greater Jakarta area.
The first phase of the project, which cost the consortium around Rp 31 trillion ($2.2 billion), is slated to be completed by 2021.
Adhi Karya also announced its plan to sell bonds worth Rp 2 trillion ($142.1 million) in the second half this year. The bonds proceeds would be used to fund one of Adhi Karya’s toll road projects in Java. The contractor previously sold Rp 2.9 trillion worth of bonds in 2017.