JAKARTA, March 1 (Reuters) - PT Bakrie Telecom , Indonesia's biggest fixed wireless telecom company, is planning to sell new shares to a partner that may eventually take control, two sources with direct knowledge of the matter said on Thursday.
Bakrie Telecom plans to raise about 900 billion rupiah ($100 million) from the sale of a 10 percent stake, the sources said, as the firm struggles to maintain liquidity following heavy investment in its data business.
"We still believe that this industry is a high growth industry. Therefore, Bakrie Telecom needs to strengthen its capital structure in order to better serve its clients," said Chief Executive Anindya Bakrie. He did not deny the potential sale.
The Bakrie Group, Indonesia's most powerful business conglomerate, is talking with at least two potential partners, which are the local Sampoerna Group and South Korea's SK Telecom , the sources said.
A spokesperson for SK Telecom denied any talk with the Bakrie Group while Sampoerna declined to comment.
The Bakrie group is expected to announce a deal in mid-March, one source with knowledge of the matter said.
"The Bakrie group is looking to sell some equity via a non pre-emptive rights issue to raise money for Bakrie Telecom," said the source. That method of fund-raising means the company does not need shareholder approval because the stake is within a 10 percent limit.
Bakrie Telecom will use the capital injection to pay back some of its debt, including 650 billion rupiah of bonds maturing this September, the source added.
The new partner will eventually buy up more shares and could become a majority shareholder in Bakrie Telecom with a 51 percent stake, one the sources added.
Sampoerna Group, a local business conglomerate which sold its cigarette business PT Hanjaya Mandala Sampoerna to Philip Morris International for $5.2 billion in 2005, appears to be the frontrunner, the sources said.
A source with direct knowledge of the matter said that the plan would be to merge Sampoerna Telecom assets into Bakrie Telecom, after Sampoerna gained control of its rival.
The Bakrie Group may sell its entire interest in Bakrie Telecom eventually, the source said.
SK Telecom, previously the leading bidder, has fallen out of favour because the price per share it is offering is too low, the sources said.
Credit Suisse is the advisor for Bakrie Group. A spokesman from the company said it could not comment on this deal.
Fitch rating agencies downgraded Bakrie Telecom's bond rating on Wednesday to 'CCC', one notch above default, because of growing concern about its liquidity position. S&P also downgraded the debt in early Feb to CCC+. ($1 = 9,020 rupiah) (Reporting by Janeman Latul and Lawrence White; Editing by Erica Billingham)