Malaysia's Khazanah set to buy 52.05% stake in Lippo from SAG
Malaysia's Khazanah set to buy 52.05% stake in Lippo from SAG
The Jakarta Post, Jakarta
Claiming to have secured consent from the Ministry of Finance,
Malaysia's Khazanah Nasional Bhd. has agreed to buy a majority
stake in Bank Lippo from Swissasia Global (SAG) -- a consortium
led by Swissasia Swissfirst Bank.
In a statement received on Sunday, the Malaysian government-
owned investment firm has agreed to a conditional agreement to
acquire SAG's 52.05 percent stake in Lippo for between Rp 3.18
trillion and Rp 3.30 trillion.
The proposed acquisition will be conducted through Khazanah's
wholly owned unit Santubong Investments BV.
"Khazanah is committed to the long-term development of
Indonesia and views this investment as an important milestone
towards further strengthening the ties between Malaysia and
Indonesia," the statement said.
Having an access to over 2.8 million customers and strong
track record of customer service and innovation, Lippo will
provide a sound platform to participate in the growth
opportunities, it added.
The price amounts to between 2.5 and 2.6 times the book value
of the country's ninth-largest lender by assets, however the
final price will be determined after Lippo first-semester
accounts are audited.
The proposed deal came amid reports of objections from certain
elements who cited a clause in the 2004 sale and purchase
agreement that states that SAG cannot re-sell its stake within
the next two years, under the so-called lock-up period.
SAG purchased the 52.05 percent stake in Lippo in February
2004, meaning that it would not be allowed to sell the stake
until early next year.
Khazanah claimed, however, that "SAG has obtained the consent
of the Ministry of Finance to sell its entire shareholding prior
to the expiry of the lockup period".
Still, Khazanah said that the planned acquisition remained the
subject of all regulatory approvals including approvals from Bank
Indonesia and the approval of Lippo's shareholders.
The above approvals and other conditions precedent to the
Proposed Acquisition are expected to be fulfilled within the next
three months.
Khazanah will also offer to buy the remaining Bank Lippo
shares in the lender, upon the completion of the deal, the
statement added.
Lippo at present boasts an extensive distribution network
comprising 395 branches and 691 ATMs throughout the country.
Khazanah is the investment arm of the government of Malaysia
entrusted to manage assets held by the Government and to
undertake strategic investments.
Dow Jones reported that Khazanah already has a presence in
Indonesia through its controlling 22 percent interest in
Malaysia's second-largest financial group, Commerce Asset-Holding
Bhd., which owns about 62 percent of Bank Niaga.