IBRA has 4 bidders vying for Bank Niaga

IBRA has 4 bidders vying for Bank Niaga

Dow Jones, Jakarta

The Indonesian Bank Restructuring Agency (IBRA) said Friday that it has received bids from four investors for a majority stake in Bank Niaga.

The bidders comprise Malaysia's Commerce Asset Holding Bhd., Indonesia's Panin Bank, Bank Victoria and the Batavia Fund. Australia & New Zealand Banking Group has a minority stake in Panin Bank.

So far, only Commerce Bank has made the US$10 million deposit required to proceed with the bid for a 51 percent stake, said I Nyoman Sender, an IBRA deputy chairman.

The agency plans to keep the bidding process open to mid- September before announcing the winner in October.

Still, potential for delay is high due to pressure in Parliament not to sell the bank at a fire-sale price to foreign investors.

IBRA canceled a first auction for Bank Niaga in June after shortlisting bids from Commerce Asset Holding and Panin Bank. The agency said the bids were too far below market price.

The agency didn't release the results of that bid, but sources at the agency said Commerce Asset Holding won the bid, with their offer valuing Bank Niaga at two times its book value. The bid translated at 30 rupiah a share, or around $130 million for the 51 percent stake.

The agency has also been trying to sell a 20 percent stake in Bank Niaga through the stock market.

The combined 71 percent stake sale is part of attempts to raise Rp 42 trillion this year from the sale of assets and loans taken over from the banking system after the 1997-98 Asian crisis.

Indonesia needs to raise money to fill a forecast budget deficit this year of 2.5 percent of gross domestic product.

Bank Niaga shares ended Rp 5 highers on Friday to close at Rp 35.

IBRA is also planning to sell government shares in Bank Danamon and Lippo Bank this year.