Lippo sale relaunched, old bidders given priority

Lippo sale relaunched, old bidders given priority

The Jakarta Post, Jakarta

The Indonesian Bank Restructuring Agency (IBRA) has relaunched
the sale of a 52 percent stake in the publicly listed Bank Lippo,
through a strategic sale mechanism it expects to complete by
February.

IBRA was scheduled to complete the sale in October, but it was
postponed due to the low prices offered by three bidders.

However, IBRA deputy chairman In Nyoman Sender said on
Thursday that the three investors would be given priority during
the current sale if they were willing to rebid.

"The old bidders will have priority because we have limited
time, but new bidders are also welcome," Sender told a press
conference.

The sale of the Bank Lippo stake comes ahead of IBRA's closure
at the end of February after five years in operation. With the
planned closure, IBRA has to press ahead with unloading its
remaining unsold assets, so as to avoid a backlash for failing to
meet its mandated task. The agency took over assets from bank
owners and failed banks following the late 1990s financial
crisis.

The three initial bidders were Eurocapital Asia Ltd., Summit
Investment Ltd. and Swissasia Global.

IBRA owns a total of 54.9 percent shares in Lippo, while
public investors own 35.5 percent. The remaining 9.6 percent is
held by Lippo E-Net, which is controlled by the Riyadi family,
the founder and former controlling owner of the bank.

IBRA has said that the postponement of the initial auction was
unavoidable as the prices submitted by the three bidders were
below the re-bid price range of between Rp 384 and Rp 591,
determined earlier by the agency.

The re-bid price range has been set by IBRA upon learning that
all of the bidders, in their preliminary bids, had submitted
bidding prices which were lower than the floor price of Rp 591
per share.

Sender did not say whether the agency expected higher bidding
prices in the second sale, or what would be the anticipatory
moves if the prices offered remained unsatisfactory.

A press statement said that IBRA had appointed ING Securities
Indonesia and ING Bank NV as financial advisors, and the law
offices of Ali Budiardjo, Nugroho, Reksodiputro as legal
advisors.

The bank's non-audited consolidated financial report said that
as of September, Lippo had booked a net profit of 27.6 billion
(US$3.27 billion), with total assets of Rp 25.8 trillion -- the
country's eleventh largest.

The capital adequacy ratio (CAR), a comparison between a
bank's capital with its risk-weighted assets, stood at 23.6
percent, far above Bank Indonesia's minimum requirement of 8
percent. Its non-performing loans (NPLs) was at 2.89 percent.