Mandiri may join bidding for Permata
Mandiri may join bidding for Permata
Tony Hotland, Jakarta
Giant Bank Mandiri has indicated it wants to join the bidding for
Bank Permata if the government sets a reasonable price for the
country's seventh-largest bank.
"If the price is relatively low, of course we'd be interested
to bid. I think other banks would also be interested if the price
were reasonable," Mandiri president E.C.W Neloe said on Friday.
He added, however, that Mandiri would wait until the
government began the offer process by announcing the price for
Permata shares, which it is slated to do on Monday.
Earlier reports said that Permata shares would be sold at a
price 1.4 to 1.8 times their book value.
"If that's true, it's quite cheap. Why not (bid)?" Neloe said,
adding that Mandiri's equity now stood at around Rp 28 trillion.
Neloe explained that if Mandiri did join the bidding process,
the bank hoped to acquire the majority of the shares.
"We would buy the bank first and then try to merge (the two
banks) later on. But we can't say yet whether we'd rather buy 71
percent or just 51 percent," he said.
The government has been trying to sell 71 percent of its 97.17
percent shareholding in Permata in a bid to raise cash to help
finance the state budget deficit. It is aiming to collect around
Rp 3 trillion (US$334.82 million) in cash from the Permata sale.
Formed after a merger of five ailing banks in 2002, Permata is
the country's seventh-largest bank in terms of assets. Its total
capital is around Rp 1.6 trillion, with assets standing at Rp
29.6 trillion.
Mandiri, meanwhile, is the country's largest bank in terms of
assets, with about Rp 249 trillion in assets.
Several other banks have expressed an interest to acquire
Permata, including Bank Negara Indonesia, Bank Central Asia, Bank
Panin, Bank Artha Graha, Singapore's Temasek Holdings and
Standard Chartered Bank.
Legislators suggested earlier that local bidders should be
given priority to avoid foreign domination of the country's
banking industry.