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Astra's new chairman steps into the spotlight

Wall Street Journal - February 20, 1997

Richard Borsuk, Jakarta, Indonesia – Bankers and securities analysts piled into PT Astra International's news conference Wednesday for a glimpse of the Indonesian auto assembler's new chairman.

In Mohamad "Bob" Hasan, they saw a man far different from his two shy, soft-spoken predecessors. Mr. Hasan occasionally chided reporters, and, at one point, pulled out a camera and snapped a picture of an Indonesian journalist posing a long question.

The news conference was a kind of coming-out party for the 65-year-old Mr. Hasan. He has been a big shot in Indonesia for many years, but only consistently in the public eye in the past four months. Also available to take questions were two of Indonesia's biggest tycoons – newly named to Astra's supervisory board – but nearly all the attention was on the new chairman.

Stepping Into the Spotlight

Mr. Hasan moved center stage in Jakarta in October when he said that Nusamba Group – the company he manages, which is 80%-owned by foundations headed by President Suharto – would buy 10% of Astra. Then he emerged as leader of an informal group of five businessmen who jointly own more than 50% of the company. Mr. Hasan then won a stake and big role in the giant Busang gold find in Borneo. Next, Nusamba bought part of Freeport McMoRan Copper & Gold's huge mine in Irian Jaya.

In the past week, Mr. Hasan arranged a settlement to a long brawl over who will develop the Busang find. It is a settlement that effectively gives companies run by Mr. Hasan a 30% stake in Busang, for which he isn't paying anything to Bre-X Minerals Ltd., the Canadian exploration concern that found the gold.

Mr. Hasan makes no effort to camouflage the reason why he is a heavyweight. "I've been friends with [President] Suharto for 40 years," he said at the news conference. The relationship between Messrs. Suharto and Hasan is so close that some Jakarta businessmen privately refer to the president as "RI 1" – the license plate number on Mr. Suharto's limousine, for "Republik Indonesia" – and Mr. Hasan as "RI 1.5."

Every move he has made, Mr. Hasan asserts, has been done simply because it was good business. But to most Jakarta business executives, a major motive for Mr. Hasan's moves is carrying out what Mr. Suharto would like. "He became Astra chairman because that's what the president wanted," an Astra executive said.

'Not a Government Employee'

Asked whether he has taken on the role of "peacemaker," settling business disputes between Mr. Suharto's children, Mr. Hasan replied that whatever he does is "purely done on a business basis – nothing else."

Asked if, as Astra chairman, he can make pure business decisions, or whether he will inevitably represent government interests, the plywood baron responded: "I'm not a government employee. The government can't employ me, I'm too expensive."

Some investors have found it costly not to have Mr. Hasan on their side. Mr. Hasan denies it, but many mining industry executives say that a deal under which Barrick Gold Corp. was to get most of Bre-X's share in Busang – a plan that some government officials heavily pushed late last year – came off the tracks because Mr. Hasan took a personal dislike to Barrick Chairman and Chief Executive Officer Peter Munk.

Some securities analysts think Mr. Hasan, as Astra chairman, intends to change the management team that has been in place for years. But on Wednesday, he indicated there was no need for a personnel shake-up. "If the directors are fine, why change?" he said.

While joking often, the blunt Mr. Hasan made clear he likes things done his way. When some reporters in the packed room moved close to the front table, Mr. Hasan warned "If you stand up there again, I'll leave." No one stood there again until the function ended.