Bank Mandiri to meet investors on $300m sale
Bank Mandiri to meet investors on $300m sale
Bloomberg Jakarta
PT Bank Mandiri will contact investors from today as it prepares to raise as much as $300 million in Indonesia's biggest initial share sale since November 1996, said a banker involved in the sale.
Investors will be contacted for two weeks and the state-owned bank will follow with presentations in Singapore, Hong Kong, Europe and the U.S. from June 9 to June 23, the banker said. The government will decide the final size and price of the sale after meeting investors, though for now it's sticking to a revised plan to sell at least a 15 percent stake, down from the 30 percent originally targeted, the banker said.
Indonesia is close to completing the sale of PT Bank Danamon and this week detailed plans to sell PT Bank Rakyat, PT Lippo Bank and PT Bank Internasional Indonesia in the second half of this year. It's selling lenders seized in a 1997-1998 financial crisis to help plug an expected $4.1 billion deficit, though it has a track record of failing to meet its asset-sale schedules.
"We believe foreign investors have started to look at Indonesian banks," said Michael Tjoajadi, who helps manage the equivalent of US$120 million in funds at PT Schroders Investment Management Indonesia.
Indonesia may be drawing investors encouraged by the May 12 upgrade of the sovereign's long-term foreign currency rating to B- from CCC+ by Standard & Poor's, he said. Bank Mandiri, formed in 1998 from the combination of four failed banks, had its debt raised to the same rating, six levels below investment grade.
ABN Amro Rothschild, Credit Suisse First Boston Inc. and PT Danareksa, Indonesia's largest investment bank, are arranging the sale. Credit Suisse spokesman Tom Grimmer declined to comment while ABN Amro Asia spokeswoman Lim Li Koon could not be reached for comment.
A sale of a 15 percent stake for about $300 million would value the bank at about 1.2 times Mandiri's end-2002 book value of Rp 14 trillion ($1.68 billion), the banker said. That's about the same price the government obtained in its sale of controlling stakes in PT Bank Niaga and PT Bank Central Asia last year.
Trading of the shares on the Jakarta Stock Exchange is targeted for early July, the banker said.