StanChart intensifies efforts to buy publicly-listed BCA
Dadan Wijaksana, The Jakarta Post, Jakarta
Already regarded as the most credible bidder, Standard Chartered Bank Plc. (StanChart) is reported to have teamed up with the Government of Singapore Investment Corporation (GIC), boosting its chances of acquiring a 51 percent stake in Bank Central Asia (BCA).
Quoting a report from the Far Eastern Economic Review, newswire Dow Jones said that, with GIC on board, StanChart was increasingly confident about its chances of controlling BCA.
The company has also sent its new CEO, Mervyn Devies, to Jakarta, where he was expected to hold talks with, among others, State Minister of State Enterprises Laksamana Sukardi and Bank Indonesia Governor Sjahril Sabirin.
Meanwhile, Suryo Susilo, Head of the Communications Division of the Indonesian Bank Restructuring Agency (IBRA), told The Jakarta Post that he had yet to hear about the partnership.
The partnership will definitely pose a serious threat to other bidders wishing to purchase a controlling block of shares in the country's largest retail bank.
Moreover, the entrance of such a credible financial institution into the bidding process would boost IBRA's faltering attempts to regain investor confidence.
The success of the BCA divestment program is seen as decisive in helping to burnish the country's already tarnished image before the international community.
One thing should be kept in mind though: StanChart previously had a bad experience when it came to taking control of a domestic bank. Last year, it had to scrap its planned acquisition of Bank Bali when the latter's employees fiercely opposed the transaction.
IBRA is currently planning to sell a 51 percent stake in BCA under a bidding process, with the strategic investors expected to submit their final bid before the Jan. 28 deadline.
Since control was wrested from the bank's founder, the Salim Group, in 1998, IBRA has faced difficulties in selling the bank, due either to interference from legislators or unfavorable market conditions.
Apart from StanChart, there are currently seven other official bidders.
They are: U.S. investment firm Newbridge Capital, Farallon Capital, Bank Mega Consortium, Dynamic Choice, Indonesia Recovery Fund Limited, the Berca Consortium and a consortium of Bank Panin shareholders led by PT Trimegah Securities.
In 1998, the government took over the ailing bank and spent huge sums in bailing out and nationalizing BCA at the height of the Asian financial crisis.
The government is barring Salim from reentering BCA, on the grounds that it violated the legal lending limit regulations when it forced the bank to channel most of the bailout funds to its affiliated business firms.