PTPN III Targets IDR 10 Trillion From PalmCo Subholding IPO In 2023

President Director of PTPN, Mohammad Abdul Ghani. (Photo: Doc. Antara)

JAKARTA - Holding Perkebunan Nusantara or PTPN III is targeting new funding through the Initial Public Offering (IPO) of the palm oil subholding, PalmCo.

The plan is for the initial public offering to be carried out in 2023. The targeted fund acquisition is IDR 5 trillion to IDR 10 trillion.

PTPN President Director Mohammad Abdul Ghani explained that before conducting the initial public offering on the Indonesia Stock Exchange (IDX), his party first consolidated all assets in the form of oil palm plantations to be managed by PalmCo.

"My calculations are IDR 5 trillion to IDR 10 trillion. It was projected from the IPO," Ghani told reporters at the Ministry of SOEs, Monday, August 22.

The proceeds will be used for the purpose of enabling state-owned companies to play a bigger role nationally in terms of palm oil and its derivative products.

To accelerate the plan, PTPN III continues to accelerate the formation of subholdings. Holding Perkebunan Nusantara is targeting the establishment of three subholdings. Apart from PalmCo, the other two subholdings are Sugar Co and Supporting Co.

"This process is currently underway, in which the establishment of the PalmCo subholding will be completed no later than October this year, considering that the formation of the subholding requires a Government Regulation," he said.

Through these three subholdings, continued Ghani, PTPN III will optimize its assets to support the national food security program. PTPN integrates the upstream to downstream palm oil industry owned by the company.

Ghani explained, to support PalmCo's expansion, PTPN plans to convert 200,000 hectares (ha) of rubber plantations into oil palm. Thus, PalmCo will manage 700,000 ha of land.

Currently, PTPN has an oil palm area of 500,000 ha. This amount is equivalent to 4 percent of the national area with a production contribution of 6 percent.

"From 500,000 ha, it will be 700,000 ha during the IPO because we will convert the rubber. Our target in 2030 is to become the largest palm oil company in the world," he said.