Friday, October 14, 2005

Malaysia’s year of acquisitions!

I should say this year is Malaysia’s year in Indonesia’s investment, just like 2003 and 2004 for Singapore. A lot of acquisitions with totally different reaction from Indonesian.
Singapore investors were facing intense opposition and criticism, sometimes out of proportion nationalism sentiment during major acquisitions by Temasek on Indosat, Bank Danamon, and Bank International Indonesia (BII). That’s not the case with Malaysia’s acquisitions, at least in the last 12 months.
Last week, Santubong Investments BV, a wholly-owned subsidiary of Khazanah Nasional Berhad, completed its proposed acquisition of a 52.05% equity stake in PT Bank Lippo Tbk from Swissasia Global for approximately US$330 million.
Santubong is also planning to make a tender offer for the remaining shares in Lippo Bank it does not own. Lippo Bank is one of the largest private banks in Indonesia initially controlled by Riyadi Family who owns Lippo Group.
Khazanah is the third Malaysian investor to acquire Indonesian banks after the 1997 financial crisis. Commerce Berhad was the first major investor when it acquired Bank Niaga (2003) followed by ICB Group which controlled Bank Bumiputera since last year. ICB is in the process to raise the capital of its Indonesian subsidiary through rights issue sometimes next month.
Khazanah’s name also tipped in the possible acquisition of 71% shares of smaller size PT Bank Tabungan Pensiunan Nasional (BTPN) worth US$90 million. Yesterday, Khazanah denied the report, but people close to PT Perusahaan Pengelola Aset (PPA) said Khazanah is one of investors that expressed interest to acquire PPA’s 28% shares in BTPN.
Late September, Khazanah, the investment holding arm of Malaysian government, subscribed to a 16.8% stake in PT Excelcomindo Pratama for a total cash consideration of approximately US$234 million.
Excelcomindo is the third largest cellular telecommunication provider. Telkom Malaysia, where Khazanah has 40.64% shares, acquired 27% shares of Excelcomindo early this year leaving the founder PT Telekomindo Primabhakti (subsidiary of Rajawali Group led by Peter Sondakh) with the remaining 47.92% and Asia Infrastructure Fund (AIF) with 10%.
With the latest move, Malaysian control 41.8% shares of Excelcomindo, almost the same size with Temasek’s control over Indosat (formerly a state-owned telecommunication company and the second largest in the market).
Khazanah also has indirect investment in Indonesian telecommunication and multimedia market through Astro All Asia Networks where it has 21.52% shares. Early this year, Astro established a joint venture with Lippo Group to develop pay TV business. The new joint venture will invest US$1 billion in Indonesia in the next few years.
Early January, Malaysian telecommunication giant Maxis Communication had acquired a 51% shares of another Lippo subsidiary PT Natrindo Telepon Seluer for US$100 million and announced its plan to turn around the loss-making cellular operator by as early as 2010.
Right before entering the new year, Malaysian YTL Corporation Berhad fired the investment market with its surprise acquisition of 35% stakes in PT Jawa Power for US$139 million. PT Jawa Power is an independent power plant producing 1,200 MW of electricity. Siemens and Powergen are other major shareholders. I bet, a lot more Malaysian investment to come.

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October 23, 2005 8:53 PM  
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