Jardine Matheson Focuses on Developing Business in Developed Countries

Jardine Matheson has announced a strategic shift to build exposure in developed Asia-Pacific markets, aiming to rebalance a portfolio heavily weighted towards Southeast Asia, notably its stake in Indonesian conglomerate PT Astra International. The 194-year-old group, historically famed for its trading in emerging markets, is undergoing a transformation from an owner-operator of diverse Asian businesses into an investment manager.

“There is no doubt, if you look at our asset base today… we have a bigger weight in Indonesia in our portfolio,” CEO Lincoln Pan told the Financial Times. Pan, who also serves as a commissioner for Astra’s heavy equipment and mining subsidiary United Tractors, said the rebalancing involves investing in countries with lower risk exposure, such as Australia. The strategy was outlined ahead of Jardines’ investor day, where the company detailed its vision through to 2030.

Jardines recently signalled this directional change with the US$2.4 billion acquisition of I-MED, an Australian radiology provider, from private equity ownership. Pan indicated the company aims to complete around three more acquisitions of a similar size over the next four to five years, focusing on businesses requiring less capital than its traditional heavy industry mix. The group will review holdings generating returns below 7% annually while seeking at least 11% for new investments, targeting a total shareholder return of 9% per year over the next five years.

Pan stated that ‘very few things are considered sacred’ regarding asset sales, noting the Keswick family’s openness to discussing all parts of the business. This includes the recent partial sale of One Causeway Bay, a site purchased by founder James Matheson in 1841. The company plans to recycle at least US$4 billion in capital by 2030, excluding commitments from Astra and property arm Hongkong Land.

While Jardines’ share price has risen 38% over the past 12 months amid the streamlining, recent business turmoil in Indonesia—which prompted complaints from Chinese authorities about operating conditions for its nickel miners—has trimmed those gains. Some investors have welcomed the increased transparency at the formerly opaque family-run business, but others caution that the pursuit of high-quality developed-market assets, which are very expensive, creates a peculiar business mix combining Indonesian automotive, Australian healthcare, and ageing Hong Kong property.