Stock buyback, Telkom to spend Rp2 Trillion

Of the 47 percent public shares, the share buyback will be undertaken by 1 percent.

PT Telekomunikasi Indonesia Tbk provides funds amounting to Rp2 trillion to repurchase (buyback) of outstanding shares in the capital market. Of the 47 percent public shares, the share buyback will be taken at 1 percent with funds from internal sources.

"But, we require prior approval from shareholders," said Telkom CEO, Rinaldi Firmansyah, in Jakarta, Wednesday, March 30, 2011. As of December 31, 2010, the company year-end cash position amounted to Rp 8 trillion.

Rinaldi added, after obtaining approval of shareholders, management has a span of one to two years to realize the plan.

He explained that the buyback of shares that can increase profits for shareholders. "Return to shareholders is better,"said Rinaldi. Decisions regarding corporate actions were implemented after the general meeting of shareholders in May or June.

As for plans buyback of shares in PT Telkomsel SingTel. Rinaldi explains, until recently it was still in talks. "It's SingTel shares, if he does not want to sell how," he said.

Rinaldi added that SingTel shares buyback plan is not included in the company's plan more than one year.

Throughout 2010, according to Rinaldi, the company recorded an increase in revenues below five percent. "We differ from other companies that have only mobile and internet. We still have a (telephone) cable,"he explained.

The Company recorded an increase of internet business by 40 percent. Cellular customers rose 15 percent, but cable phone subscribers fell 8 percent.

This year, the company allocates capital expenditures amounted to Rp17 trillion. 70 percent of capital expenditure will be used to strengthen mobile business. "The rest is for broadband and others," he said. Telkom also has debt maturities amounting to Rp 4 trillion this year.