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Monday, March 29, 2010

XL stock sell price IDR3,300: Axiata prepares greenshoe with soaring demand

Monday, 29/03/2010 00:00 WIB
XL stock sell price IDR3,300: Axiata prepares greenshoe with soaring demand

Irvin Avriano A.
for Bisnis Indonesia

JAKARTA: Axiata Group Berhad tapped IDR5.05 trillion proceeds from the divestment of 1.53 billion shares or 18.2 percent shares of PT XL Axiata Tbk, the subsidiary firm, with a par value of IDR3,300.

Axiata, with 86.5 percent ownership at XL through Indocel Holding Sdn Bhd, finalized the secondary offering process last week. The offering process will be closed with crossing today.

President Director of XL Hasnul Su-hai-mi said the stock sell price was defined at top level of the offering price ranging form IDR3,000- 3,300. Besides, the demand from investors has increased 3-4 fold or 4.59-6.12 billion shares.

The sale price was discounted 6 percent if compared to XL stock price at market of IDR3,500 following the sharp rise of 4.48 percent or IDR150 last Friday. Thus, AXiata raked up IDR5.05 trillion proceeds or 1.83-2/02 billion ringgit.

"With the soaring demand, Axiata shareholders prioritized local buyers with higher allotment or 50-80 percent (as from the offered stocks)," he said in press conference on the stock sales process yesterday.

Hasnul added to maintain XL stock price following secondary offering, Axiata also prepared 1.8 percent greenshoe in the next three days. If necessary, the option will be executed by Goldmand Sachs (Singapore) Pte, as the initial buyer.

In the offering Axiata is assisted by CIMB Invest-ment Bank Berhad, PT Mandiri Se-kuritas, J.P. Morgan Securities Ltd, and Morgan Stanley Services Ltd.

Hasnul the corporate action is not public offering so that it was only offered to less than 49 domestic investors. With the scheme, the execution did not refer to the capital market regulation on public offering.

He failed to detail the number of domestic and foreign investors winning over the XL stock offering. The allotment of new stocks is scheduled today.

In addition to Jakarta, Axiata also offered XL stock to investors in Singapore, Hong Kong, New York, Washington, Boston, London, and Edinburgh on the secondary offering roadshow.

He claimed to have not been informed about the allocation scheme of the proceeds by the shareholders. But he is sure the divestment here will increase the public ownership portion which then maximize the XL shares at IDX.

"Thus, we believe and expect the underwriter could allocate our shares to the active investors in the bourse," he said.

Wit the divestment, the public increased their possession as from 0.2 percent into 18.2 percent. The other shareholders, in addition public and Indocel, include Emirates Telecommunications Corporation (Etisalat) with 13.30 percent.

President and Chief Executive Officer Axiata Dato' Sri Jamaludin Ibrahim in statement said the soaring public ownership portion is expected to grow the equity liquidity and fair pricing of XL stocks.

So far, many analysts avoid reviewing XL performance due to the less significant number of XL stocks so as not to reflect fair pricing.

Analyst of JPMorgan Securities Ltd Tim Storey in the February 13 research, it sharply swelled the XL stock price target into IDR2,950 from IDR2,850. He projected the revenue of XL of IDR16.21 trilion by end of the year and IDR18.48 trillion in 2011.

"We believe the soaring XL revenue has been reflected from the mounting stock price of 45 percent since early this year." (Bisnis/iaa/pul)

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