June 19, 2006

Indonesian shrimp producer to launch IPO

PT Central Proteinaprima (CP Prima), Indonesia's largest shrimp producer and exporter, is hoping to raise up to US$40 million in an IPO to be offered next month to finance its capital expenditure this year.

The company would be offering 2.16 billion shares at a price of between Rp 175 (about US$0.01) and Rp 200 a share from July 3 to 5, and to list them on the Jakarta Stock Exchange on July 10.

PT Danareksa Securities has been appointed as underwriter for the IPO.

Proceeds from the IPO would fund its planned capital expenditure of US$80 million to increase shrimp production through the construction of 2,000 more shrimp ponds, adding to its current 3,732 ponds, according to Achmad Wahyudi, the director of CP Prima's aquaculture operation.

Additional funding will be obtained from borrowing and the issuing of 4.33 billion warrants with maturities of three years, he said, adding that the warrants would come with the IPO shares.

With the additional ponds, the company expects to earn a net profit of US$40 million next year, he added.

CP Prima booked a net profit of Rp 201.4 billion (US$22.3 million) last year, 62.5 percent higher than 2004's Rp 123.9 billion (US$33.4 million). The company had about 25 percent increase in sales last year. No profit targets were given for this year.

The company, an Indonesian unit of Thailand's agribusiness giant, the Charoen Pokphand Group, is the largest Indonesian exporter of frozen shrimps to the United States, Japan and the European Union.

The company voluntarily delisted its shares from the Jakarta Stock Exchange in December 2004 to simplify its business organisation and structure.