Madiun, East Java (ANTARA News) - State Enterprises Minister Dahlan Iskan said he would merge PT Barata Indonesia and PT Boma Bisma Indra (BBI), two big state-owned engineering companies.
"Actually the right term would be acquistion and not merger. The result of my meeting with 12 president directors of state-owned companies operating in engineering on Friday night (Jan 13) is the plan to merge Barata with BBI. Our conclusion was Barata will acquire BBI," he said to newsmen at Hotel Merdeka Kota here on Saturday.
He said the decision was taken solely for effectiveness reasons. Dahlan said PT Barata has now been on the phase of consolidation while PT BBI is in the period of crystallization. So, it would be better if the two are united. Following the acquistion later PT Barata will focus on sugar factory and steel construction while PT BBI on provision of palm oil factories.
"So the two state-owned companies would focus on things needed by Indonesia at present," he said.
He said Indonesia would need hundreds of palm oil plants because so far the palm oil processing is still being carried out abroad.
He said the target to achieve was PT BBI must have capability in the engineering of palm oil plants and marketing them meaning it must be able to convince palm oil companies to order palm oil plants to process their production so that they would not do it abroad.
He said this was a big opportunity for PT BBI as oil palm plantations in Indonesia reach millions of hectares while the number of factories is minimum now totalling only 100 units.
Regarding PT Industri Kereta Api (INKA) he said he did not as yet wish to merge the train manufacturer with other state-owned companies because PT INKA has been considered out of critical periods.
"I think PT INKA has been on a take-off stage. It has been able to surpass its critical periods namely crystallization and consolidation. So, I think it will not be merged with other state-owned companies and will continue to focus on train manufacturing industry," he said.
He said what he wished to do on a number of state-owned companies in Indonesia was making changes on a number of sugar companies which are now facing a difficult situation and also on a number of shipbuilding companies that have so far not yet been able to build ships by themselves.
"There are now four shipbuilding companies that need to be advanced. They must unite to produce ships needed by Indonesia," he said.
Dahlan arrived in Madiun on Friday by train and immediately visited PT INKA upon arrival. He then visited his home village in Magetan where he also made a visit to the Sabilul Muttaqin Islamic Boarding School.
After that he met with the president directors of 12 state-owned companies at PT INKA headquarters.
He left for Surabaya, the capital of East Java, by train on Saturday morning.