Malaysian investor pulls out from BCA tender
Dadan Wijaksana, The Jakarta Post, Jakarta
A Malaysian investor, Malaysian Plantations Bhd., announced late last week that it had dropped its high-profile bid to purchase a controlling stake in publicly listed Bank Central Asia (BCA).
No clear reason was given. Malaysian Plantations, which owns Alliance Bank, one of the top 10 banks in Malaysia, is one of the nine investors selected for the final bid for the government's shares in BCA, Indonesia's largest retail bank.
"We wish to advise that Malaysian Plantations Berhad will not be proceeding further on the proposed bid for up to 51 percent of BCA," the company's statement was quoted by Reuters as saying on Monday.
The Malaysian Plantation Group is seen as one of the noteworthy foreign investors currently carrying out a due diligence investigation into the bank.
The withdrawal of the Malaysian investor would be yet another blow to the Indonesian Bank Restructuring Agency's (IBRA's) faltering efforts to revive foreign interest in the local company.
Success with the BCA divestment program is seen as decisive in helping to strengthen the country's already deteriorating image before the international business community.
Elsewhere, in a surprising response, IBRA deputy chairman for bank restructuring Soebowo Musa told The Jakarta Post on Tuesday that he could not confirm a report saying he had yet to receive any notification regarding the matter.
"I cannot give any confirmation just yet as I haven't received such information from our financial advisors. So, as far as I'm concerned, there are still nine bidders for the BCA tender," Soebowo said.
He was referring to the nine investors currently undertaking due diligence into the bank.
Aside from the Malaysian firm, there are currently eight other official bidders for the divestment program, with the agency announcing earlier it had extended its deadline for investors to submit their final bids to Jan. 28 next year.
The agency said previously it had expected the final bid for the sale in the third week of December, with the announcement of the successful buyer to be made the following week.
The other eight bidders are: Farallon Capital, New Bridge Capital Inc. Consortium, Standard Chartered, Bank Mega Consortium, Dynamic Choice, Indonesia Recovery Fund Limited, Korsorsium Berca and Korsorsium Pemegang Saham (shareholder consortium of) Bank Panin.
The nine investors were shortlisted from 15 bidders that had been included in preliminary bids to acquire the bank.
The government has been hitting snags in divesting its remaining 51 percent stake in BCA due either to unfavorable market conditions or strong resistance from legislators.
In 1998, the government took over the ailing bank and spent trillions of rupiah on its way to bailing out and nationalizing BCA at the peak of the regional financial crisis.
The government has banned the bank's founding owner, the Salim Group, from repurchasing it, based on the fact that it had violated the legal lending limit regulations when it forced the bank to channel most of the bailout funds to its affiliated business firms.