MTI was spun off from Pelabuhan Indonesia II, known simply as Pelindo II, in 2002. It handles logistics, container terminals and multipurpose terminals for customers using the port at Tanjung Priok.
Pelindo II controls a 99 percent stake in MTI, with the remainder owned by a cooperative of Tanjung Priok port employees.
“MTI needs Rp 300 billion in funds for its expansion next year. The funds are expected to be secured from an IPO,” Mulyono, the finance director of Pelindo II, told Investor Daily on Tuesday.
He added that the IPO is slated for the second half of 2013. However, if the IPO falls through, Pelindo II will allow MTI to separately sell bonds.
As for Pelindo II itself, the company has announced a plan to sell up to Rp 3.5 trillion worth of bonds to help finance its expansion.
“The proceeds [from the bonds sales] will be used to help finance the [first] phase [of] construction of the Kalibaru terminal, as well as [raise] working capital for the company in general.
Mulyono had said on Sept. 20 that the port operator needs $4 billion to build the Kalibaru Port, also known as the “New Priok Port,” which is situated seven kilometers west of Tanjung Priok in North Jakarta.
The company will divide investment spending into two phases: $2.5 billion for the first phase and $1.5 billion for the second.
The construction of the first section is expected to be completed in 2014, while the second phase will begin in 2018 and is expected to be completed in 2022.
Investment for the first stage will cover a plan to build thee container terminals with a combined capacity of 4.5 million twenty foot equivalent units (TEUs), two fuel oil terminals and a gas terminal with a combined capacity of nine million tons per year.
Once the second phase is completed, four more terminals will be added, bringing the total container handling capacity of the New Priok Port to 12.5 million TEUs.
Pelindo II wants to increase its port handling capacity in Tanjung Priok Port, the busiest port in Indonesia that it operates, since strong domestic economic growth has fueled a rapid boom in the container handling business, with more goods flowing through the port.
With faster processing and a greater capacity, businesses are expecting to cut logistics costs while the operator can also increase revenue and contribute to the state through taxes.