Adira to sell 10% stake via IPO

Rendi A. Witular, The Jakarta Post, Jakarta

Financing company PT Adira Dinamika Multi Finance plans to sell 100 million shares, or 10 percent of its total stock, on the stock market via an initial public offering (IPO), in a bid to raise cash to expand business.

In a news conference on Friday, the company said that its share price would be in the range of between Rp 2,200 and Rp 2,000, with the offering expected to start on March 23. The shares will be listed on the Jakarta Stock Exchange on March 30.

The company is expected to raise around Rp 250 billion (US$29.1 million) from the IPO.

Adira, which was established in 1991, is mostly in the business of financing motorcycle purchases. With 105 branches, the company holds a 12 percent market share of the domestic finance sector, which was worth about Rp 78 trillion last year.

Adira's financing portfolio has grown by 110 percent annually in the last three years, with lending in 2003 totaling about Rp 3.7 trillion.

The company recorded a revenue of Rp 650 billion last year, up from Rp 249 billion in 2002. Its net profit also surged to Rp 165 billion from Rp 38 billion.

As for this year, the company has targeted a revenue of Rp 965 billion with a net profit of Rp 325 billion.

Adira said that after completing the IPO, the company would proceed with the planned sale of 75 percent of its shares to Bank Danamon, the country's fifth largest bank in terms of assets.

In late January, the bank had signed a conditional sales and purchase agreement with Adira, but the deal was held up until the bank had received approval from its shareholders, the central bank and the Capital Market Supervisory Agency (Bapepam).

The bank, which is 61.88 percent owned by a consortium of Temasek Holdings Pte. Ltd. and Deutsche Bank, earlier said that the plan to acquire Adira was driven by the fact that the country's financing sector had grown rapidly in the past few years.

With the completion of the IPO and the acquisition by Danamon, Adira's current controller Theodore Permadi Rachmat and Stanley Setia Atmadja will hold the remaining 13.5 percent and 1.5 percent respectively in Adira.

Rahmat is a former president of publicly listed automotive company PT Astra International, while Stanley is a businessmen.