IBRA shortlists four bidders for Bank Niaga
IBRA shortlists four bidders for Bank Niaga
Dadan Wijaksana, The Jakarta Post, Jakarta
The Indonesian Bank Restructuring Agency (IBRA) announced on
Tuesday it had shortlisted four bidders, two of which are
foreign-led consortia, for a 51 percent stake in mid-sized Bank
Niaga.
The four bidders are consortia led by Australia & New Zealand
(ANZ) Banking Group Ltd., Malaysian financial group Commerce
Asset-Holdings Berhad, Bank Victoria International and Batavia
Investment Fund.
Asset-Holdings Group owns Malaysia's third largest banking
group, Bumiputera-Commerce.
Batavia Investment Fund is an Indonesian-based fund and was
part of a consortia led by Singapore's Cycle & Carriage (C&C)
that won the bid for a 40 percent stake in auto giant PT Astra
International two years ago. C&C now holds a 32 percent stake in
Astra.
Bank Victoria is a relatively small bank listed on the Jakarta
Stock Exchange.
The agency did not provide details on other members of
investors in each consortium.
Meanwhile, Dow Jones reported that according to Paul Edwards,
ANZ spokesman in Melbourne, the bank's involvement in the
consortium is through its 11 percent stake in Indonesia's Panin
Bank.
"As such we would assist Panin where possible, however, the
extent of our involvement/assistance is still to be determined,"
Edwards said.
IBRA will now provide time for the four bidders to carry out
due diligence on the bank before submitting their final binding
bid. The agency has targeted to complete the sale process in
June.
The government, via IBRA, nationalized Bank Niaga in the late
1990s. It now holds a 97.15 percent stake in the publicly listed
bank.
The Bank Niaga sale comes after the government completed the
sale of a 51 percent stake in Bank Central Asia (BCA) last month
to a consortium led by U.S. investment firm Farallon Capital
Corp. BCA is the country's largest retail bank.
It was also revealed in the statement that IBRA would apply a
similar scoring system as it did in the BCA sale.
Investors can get a maximum 40 points for "financial
institution experience," but only up to 20 points for a "non-
binding bid price".
There are other points awarded, depending on how many
conditions investors attach to their bids, their ability to pay
for the stake, and experience in mergers and acquisitions.
The Bank Niaga disposal should provide further tests for the
government on whether it will carry on with its economic reform
program.
The sale of government shares in nationalized and
recapitalized banks is part of a bank restructuring program
agreed with the International Monetary Fund.
Getting credible investors for local banks has been the
government's priority, to help revive confidence in the banking
industry.
Moreover, the government could use part of the proceeds to
help cover the 2002 state budget deficit, projected to stand at
around Rp 42 trillion (US$4.4 billion).
The agency, which has taken over around Rp 600 trillion worth
of assets from ailing banks, has been targeted to collect Rp 42.8
trillion from asset sales this year.
Shares in Bank Niaga were slightly down to Rp 170 on Tuesday
from Rp 175 on the Jakarta Stock Exchange.
The medium-sized bank last year managed to post Rp 41.1
billion in net profit, the first positive balance sheet ever
since the devastating 1997-1998 financial crisis.
Also last year, the bank's credit adequacy ratio (CAR) stood
at 18.7 percent, while its non-performing loans reached 9.75
percent.
PT Trimegah Securities, Kartini Mulyadi and Partners are
acting as the respective financial and legal advisors in the Bank
Niaga sale.