June 21, 2008
Indonesia: Telkom shareholders approve share buyback
Shareholders of Indonesia's PT Telekomunikasi Indonesia on Friday approved a plan to buy back up to 3 trillion rupiah ($323 million) worth of shares within the next 18 months.
The country's largest telecoms firm said last month it planned to buy back shares equivalent to 1.9 percent of its share capital to return excess cash to shareholders and help support the company's share price, reported Reuters.
Telkom's share price has fallen 23.6 percent since the start of the year, underperforming a 13.6 percent drop in the benchmark index .JKSE, as investors worried about rising competition in the mobile phone industry.
Telkom, which is valued at $16.4 billion, said on Friday that it has spent a total of 3.8 trillion rupiah on buying back shares as of June 19, bringing the number of the firm's treasury stock to 426 million shares.
"The share buyback is part of the company's strategy to increase the company value and shareholder value," Telkom's president director, Rinaldi Firmansyah, said in a statement.
Shareholders have also approved a special dividend payment of 1.93 trillion rupiah on top of the regular 7.07 trillion rupiah dividend, bringing the total dividend payment for the 2007 financial year to 9 trillion rupiah.
Telkom is aiming for an 11-12 percent increase in revenue this year, up from 59.44 trillion rupiah in 2007, despite tougher competition and economic conditions, thanks to strong growth in its mobile phone business.
The number of subscribers in the world's fourth-most populous nation is expected to jump to 120 million this year, from around 90 million last year.
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