Shareholders approve NISP's stake sale
Leony Aurora, The Jakarta Post, Jakarta
Shareholders of Indonesia's NISP bank have approved the sale of a 28.5 percent of stake to the Overseas-Chinese Banking Corporation Ltd. (OCBC), making the Singapore-based company the majority shareholder.
The purchase would give OCBC a controlling 51 percent stake in the bank, NISP's president director Pramukti Surjaudaja said in an extraordinary shareholders meeting on Thursday.
"The shares will be sold at 2.5 times of the book value stated on the bank's latest financial report, after the sale is approved by Bank Indonesia (BI)," Pramukti said.
Based on the bank's book value in December, OCBC -- through its subsidiary OCBC Overseas Investment Pte. Ltd. (OOI) -- will have to spend about Rp 992.62 billion (US$107.89 million) for the acquisition of over 1.1 trillion shares at about Rp 842.5 each.
"There may be an increase in March or April," said Pramukti, referring to the time when the purchase is expected to take place.
After the sale is approved by the central bank, OOI will execute a tender offer for the remaining shares at the same price, as required by the regulations.
"We don't have any specific target for how many more shares to acquire. What's important is that we have a simple majority," OCBC executive vice president Linus Goh said.
Goh said OCBC would not make any dramatic changes to its future subsidiary. "We are very comfortable with NISP's vision and mission," he said.
According to its latest financial report from September last year, OCBC has 112 branches in 14 countries, including one in Indonesia, with total assets of $73 billion.
With such a strong partner, NISP may expand more rapidly to reach larger markets in Indonesia. "We aim to have NISP become one of the five top private banks," said Goh.
The Singaporean lender first entered the Bandung-based bank last year by acquiring 22.5 percent of stakes at $73.1 million.
NISP's other shareholders include founder the Surjaudaja family, the World Bank's financing arm, the International Finance Corporation and public investors.
"After the stake sale, our shares will be between 5 percent and 10 percent," Pramukti said.
As of Dec. 31 last year, NISP recorded an unaudited 63 percent increase in net profit to Rp 288.1 billion from Rp 176.7 billion it posted in the same period the previous year on stronger lending.
Net interest income grew to Rp 642 billion in 2004 from Rp 449 billion in 2003, while its loan-to-deposit ratio stood at 76.73 percent. Its total assets stood at Rp 17.79 trillion.