M&A ACTION IS INCREASINGLY RAMPANT

JAKARTA - A number of issuers plan merger and acquisition actions as a strategy to boost performance and enlarge the company's assets.

Based on data collected by Bisnis, there are at least 17 issuers preparing M & A actions by 2018.

This publisher consists of 4 publicly listed mining, 4 infrastructure and building materials, and 3 hospitals and pharmaceutical sectors. (see Table)

Corporate Secretary of PT Golden Energy Mines Tbk. (GEMS) Sudin revealed that the company is still on track to acquire PT Barasentosa Lestari (BSL).

"From the Ministry of Energy and Mineral Resources we were granted permission on April 27, 2018. Hopefully with Singaporean parents soon finish as well, so the acquisition realization in June," he told Bisnis.

After the approved BSL acquisition with a total of US $ 65.64 million, GEMS coal reserves will grow 194.6 million tons.

In addition, jumbo acquisition is being finalized by PT Adaro Energy Tbk (ADRO). Adaro Energy's President Director Garibaldi Thohir said the company is still in the process of acquiring Kertel's Australian coking acquisition process.

Together with EMR Capital, Adaro wants to take over 80% of Rio Tinto's stake in the mine. The acquisition value reached US $ 2.25 billion with Adaro contribution contributing 49% faster.

"Hopefully in May or June this transaction will be completed, and Adaro will be faster in coocking coal business development," he said.

Meanwhile, the registered oil and gas trading company, PT Himalaya Energi Perkasa Tbk. (HADE) targets the acquisition of Panca Sinergi Perkasa to be completed by the end of 2018. Piter said the acquisition will require Rp390 billion and will be sourced from the rights issue of HADE.

"After the acquisition of PSP, profits and profits will increase in 2019 because PSP already has a contract purchase and purchase of electricity mini hydro power plant with PLN," said Director of Himalaya Energi Perkasa Piter Rasiman.

Meanwhile, listed producers of chemicals and oil palm plantations PT Eterindo Wahanatama Tbk. (ETWA) targets the merger process with its partner companies to be completed in the third quarter of 2018.

Director of Eterindo Wahanatama Azwar Alinudding said that ETWA has formed informal agreements with strategic partners. The process of merger settlement with partners engaged in the oil palm plantation business is expected to spur the operational and financial performance of the company.

Ticker

M&A

Nilai

HADE

Acquisition of PT Panca Sinergi Perkasa

Rp390 billion

SMGR

Acquisition of Mortar Plant

Rp200 billion

RAJA

Acquisition of gas distributor company

US $ 55 million

NICK

Acquisition of the property company Jaksel

Rp12 billion

BRPT

Acquisition of Star Energy

US $ 755 million

ADRO

The acquisition of Rio Tinto shares at the Kerstel mine

US $ 2.5 billion

KAEF

Acquisition of 1 pharmaceutical company and 2RS

Rp2.3 trillion

MDKA

Acquisition Finders Resources Limited

US $ 50 million

GEMS

Acquisition of PT Barasentosa Lestari (BSL)

US $ 65.64 million

PPRE

Acquisition of erector and foundation companies

Rp320 billion

WSBP

Acquisition of an iron plant

Rp500 billion

TOWR

Acquisition of PT Komet Infra Nusantara

Rp1.4 trillion

SRAJ

Merged with Bogor Medical Center

Rp300.18 billion

INPS

Acquisition of PT Jono Gas Pejagalan

Rp19 billion

ABMM

Acquiring a coal mine

US $ 200 million

ETWA

Merger with a plantation company

Rp260 million

PT Royal

Hospital acquisition

Rp400 million

Prima Tbk*

 

Source: Company, News, processed.

Director of Investa Saran Mandiri Hans Kwee conveyed, the lambing sector that dominates M & A action as commodity prices are heating up in the last 2 years.

"Mining companies are gaining momentum in price fixes to improve performance, thus expanding inorganic expansion," he said, Thursday (3/5).

MOMENTUM EXPANSION

Meanwhile, infrastructure and building materials sector received positive sentiment from the government agenda focusing on infrastructure development that encouraged related companies to expand capacity.

Vice President of Research and Analyst PT Valbury Securities Indonesia Nico Omer Joncheere said M & A actions can benefit the issuer because it can build synergies to save costs, take brands or technology, and add resources.

Analysts at PT OCBC Sekuritas Indonesia Liga Maradona said M & A action is usually based on two considerations, that is easier and cheaper to add or diversify products, and consolidate with partner companies that have unique or strategic value. Issuers that acquire hospitals, for example, do not have to bother to start development from scratch and reach new markets.