15 investors submit bids for 51% BCA share
15 investors submit bids for 51% BCA share
Berni K. Moestafa, The Jakarta Post, Jakarta
The Indonesian Bank Restructuring Agency (IBRA) said that 15
investors had submitted preliminary bids for a 51 percent stake
in Bank Central Asia (BCA), marking the next step in a tender
offering that IBRA was rushing to finalize before the end of the
year.
IBRA chairman I Putu Gede Ary Suta said that from the 23
investors that had expressed interest in BCA, 15 had submitted
preliminary bids.
"This morning we disclosed the preliminary bids for BCA: they
totaled 15," Ary Suta told reporters.
He refused to disclose their identities, but said they were
both local and foreign investors.
Reports said earlier that bidders for the BCA stake had
included JP Morgan Partners, ABN Amro, Standard Chartered, Bank
Negara Indonesia and local securities firms Trimegah Securities
and Makindo. The Bank of China had also been rumored to be
interested in BCA.
The entry of bids for the BCA stake raises new optimism that
the government's key divestment program may be completed this
year. No less than Coordinating Minister for the Economy
Dorodjatun Kuntjoro-Jakti said earlier that a sale this year was
unlikely due to poor market conditions.
The government is expected to obtain around Rp 5 trillion
(US$471.70 million) in proceeds from the sale of the 51 percent
stake in BCA, which would be a significant contribution toward
the financing of this year's state budget deficit.
The completion of the BCA sale would also help revive investor
confidence in the ailing economy, analysts said.
Ary Suta said IBRA would short-list the 15 investors, but
there was no telling when the final bidders could be announced.
"The qualities sought in short-listing the bidders include:
prime banks or investment firms with a good reputation, solid
financial position, transparent funding sources, not being
included in the list of people who have been blacklisted by Bank
Indonesia, not being directly or indirectly affiliated to the
former owners of BCA, and their offer price," IBRA said in a
media statement.
It added that short-listed bidders were entitled to carry out
due diligence investigations on BCA.
"From the result of the due diligence process, which takes
several weeks, strategic investors will submit their final bids,"
the agency said.
Efforts to find the bank a strategic investor began last year.
Back then, legislators blocked the sale due to unfavorable
market conditions. It identified as one of the reasons the fact
that the IMF had suspended its loan program for eight months
until last August.
Last June, a plan to sell a 31 percent stake in BCA came to
nothing due to what was believed to have been low bids.
The government then raised the stake to 51 percent in the hope
of luring strategic investors.
Some analysts have said that the current downturn in market
sentiment abroad has dampened the appetite of investors for
Indonesian assets.
They warned that this situation might result again in low
bids.
Chairman of IBRA's oversight committee Mar'ie Muhammad said
IBRA had to ensure that only a credible investor would gain entry
into BCA.
"We don't want fly-by-night operators, taking their profit
then bidding farewell," he told reporters.
Final bidders must undergo a fit and proper test by Bank
Indonesia, which will become the final arbiter, filtering out the
credible investors from the dubious ones.