IBRA to sell Salim's oil palm plantations soon
JAKARTA (JP): The Indonesian Bank Restructuring Agency (IBRA) said on Friday that the sale of the 24 oil palm related companies formerly owned by the Salim Group has been brought down to two bidders.
Speaking in a press meeting, Dasa Sutantio, head of IBRA's asset management division, said the agency expected to announce the winner of the bidding on Monday, a deal that could mark the agency's second largest sale this year.
"For this year, besides Astra, it might be the second largest one," Dasa said, but refused to disclose the value of the deal.
He was referring to the sale of a 39.5 percent stake in PT Astra International to a consortium from Singapore that had given the agency Rp 2.03 trillion (about US$220 million at the current rate) in cash.
Dasa said two investors had given their final bids to take over all of the 24 companies under Salim's oil palm plantation business.
"These two (investors) here are the best that have emerged from the preliminary bid," Dasa said.
He refused to unveil the names of the two bidders but he said that they were part of seven original bidders, which includes PT Indofood Sukses Makmur, Guthrie of Malaysia, Cargill/Chase (Hongkong) consortium, Bhakti Investama, Sartoga/Newbridge, IOI consortium and Olympus consortium.
Indofood said on Thursday it had dropped its bid after IBRA changed the timetable for the final bid to Nov. 23.
"With the revised timetable, Indofood as a listed company would face difficulties in complying with the Capital Market Supervisory Agency's rules and regulations on the planned acquisition," Indofood's president Eva Riyanti Hutapea said.
Dasa said the government's Financial Sector Policy Committee has ruled out Indofood's participation because the company was affiliated to the Salim Group.
"Any company or individual with debts to the government is not allowed to take part in the bidding. And this might have been the reason why Indofood dropped out," he explained.
Salim has a 48 percent stake in Indofood through the Hong Kong-based First Pacific and has come under fire earlier for its purchase of the Singapore-based QAF Pte Ltd's shares from IBRA.
IBRA said the Salim Group is one of the country's key players in the palm oil industry, with the largest planted hectarage of any company in the world.
The plantations are scattered in various provinces in Sumatra and Kalimantan and were established between 1986 and 1997.
Some of Salim's palm oil mills also process the palm fruit into crude palm oil, the agency said.
It further said that Salim's plantations were considered among the most efficient, even compared to oil palm expert Malaysia.
However, its oil palm plantation business represents only about 16.28 percent of the total asset value under Holdiko.
IBRA has placed 107 companies of the Salim Group under Holdiko's supervision.
Thus far, Holdiko's assets have earned IBRA over Rp 5 trillion.
The latest deal being the sale on Friday of Salim's Mosquito Coil Group (MCG) to the London-based Reckitt Benckiser PLc for Rp 610 billion.
In a press statement, Dasa said Reckitt Benckiser gave the most attractive offer in a bidding process that began in August this year.
He said Benckiser had purchased Holdiko's 100 percent stake in MCG, a manufacturer and distributor of raw materials for mosquito coils.
Bart Becht, chief executive officer of Benckiser said the mosquito coil business was highly profitable in Indonesia due to the country's large population.
"The Mosquito Coil Group will give us a strong platform for entry into this key market while substantially strengthening our worldwide presence in pest control, a key company category," Becht said in a statement.
IBRA will also put Salim's coal mining company Indocoal for sale in the first quarter of next year.
Grouped under Indocoal are PT Indotambangraya Megah and PT Ganda Upayatama, which themselves control four subsidiaries.
Together, the companies control about 564 million metric tons of coal reserves in East Kalimantan and a total of 120,000 hectares of coal concessions in the province and in South Sumatra.
According to Dasa, about 15 foreign and five local investors had expressed their interest in acquiring a stake in Indocoal.
He refused to name them but said they appeared serious in purchasing the coal mining company.
"These are companies that have a name, are big, have money and constantly chasing us," he explained. (bkm)