JAKARTA, Nov 20 (Reuters) - Singapore's Cycle & Carriage Ltd said on Wednesday it wants to modestly increase its stake in PT Astra International and confirmed it will be a standby buyer of the Indonesian auto firm's rights issue.
But C&C denied market speculation it might seek to take over Astra, in which it now has a 32 percent holding, if many investors refused to cough up cash for the rights issue.
"Yes, we would like to increase our stake (in Astra) but we don't want to go into a majority or anything like that. We might move up to 33 or 34 (percent), something like that," C&C finance director Neville Venter told Reuters by telephone.
But he said the company would not make a final decision on the exact amount of its buying before the price of the rights issue is set, which is expected before a December 16 meeting of Astra's shareholders to consider the rights issue.
"No decision has been taken. It depends on the market demand, the pricing and all sorts of things...but we know how much we can spend. We will have a board meeting next week," Venter said.
Astra plans to issue a maximum of three billion new shares through the rights issue to raise up to 1.5 trillion rupiah ($167 million) to help repay hefty debts. Astra's outstanding shares now are just 2.6 billion.
The new shares will be offered at a price between 500 and 2,000 rupiah and are set to be listed on the Jakarta bourse on January 14.
According to Venter, JP Morgan and ING Barings are expected to become the lead underwriters of the issue and share with Cycle & Carriage any unsubscribed rights as the standby buyers.
Dealers said JP Morgan's Jakarta brokerage has been buying stock in Astra over the last two days, helping to boost the shares by some 14 percent after they plunged more than 10 percent on Monday, dragged down by concerns over the rights issue.
By the midday break on Tuesday, Astra was up 8.22 percent at 1,975 rupiah, after hitting a two-week high at 2,000 rupiah earlier. The broader market was up 0.31 percent. ($1=8,968 rupiah)