Nissin, First Pacific take 60% stake in Indofood

JAKARTA (JP): Publicly listed PT Indofood Sukses Makmur, the world's largest instant noodle maker, announced on Wednesday that several of its controlling shareholders plan to transfer 60 percent of their company shares to a Dutch holding company specifically set up for the purpose.

Indofood's chief executive officer Eva Riyanti Hutapea said in a statement on Tuesday that the share transfer was made following the conclusion of an agreement between Nissin Food Products Company Limited, First Pacific Company and the Salim Group on Wednesday.

The agreement allowed Nissan and First Pacific each to acquire 50 percent equity interest in the Dutch holding company from the Salim Group.

"Consequently, Nissin and First Pacific each will own a 30 percent indirect beneficial interest in Indofood," Eva said.

The transaction is expected to be finalized by the beginning of February next year, she said.

Though she did not mention the value of the transaction, Dow Jones News Wires said that the purchase of the 60 percent stake in Indofood would cost Nissan and First Pacific a total of US$570 million.

First Pacific Company Limited, which is 53.5 percent owned by Indonesia's Salim Group conglomerate, is a Hong Kong based company with its core businesses in marketing and distribution, telecommunications, and the property and banking sectors.

Nissin Food Products Company Limited is one of Japan's leading food companies and a major instant noodle producer. The company has around 40 percent of the Japanese instant noodle market.

Eva expressed confidence that the new controlling shareholders of Indofood would further strengthen the company's core business given Nissin's expertise in instant noodles and First Pacific's strengths in marketing and financial management.

"Both investors are therefore expected to contribute to the strong growth of Indofood in the future," she said.

This transaction will also enable Indofood to have greater opportunities in the domestic and international market.

She noted that subject to the approval of Indofood's majority independent shareholders, Nissin has agreed to extend technical assistance to Indofood to improve efficiency in the production of its noodles.

As a result of the transaction, the composition of the shareholders in Indofood will change significantly, with the Dutch holding company controlling 60 percent of Indofood, the Indonesian government 10.18 percent, public shareholders 27.16 percent and the Salim Group the remaining 2.66 percent.

Eva said in line with their new position as controlling shareholders of Indofood, new commissioners and directors will be nominated by First Pacific and Nissan, she said.

Indofood is currently 62.66 percent owned by the Salim Group, 10.18 percent by the Indonesian government and the remaining 27.16 percent is owned by public investors.

Share prices of Indofood became the target of buying on Tuesday, closing firmer by Rp 275 to Rp 4,225, with a total of 10.91 million shares changing hands. (aly)