JAKARTA (TheInsiderStories) – ExxonMobil, an U.S energy company has announced its plans to acquire 100 percent interest of PT Federal Karyatama (FKT), a subsidiary of publicly listed motorcycle lubricant manufacturer PT Mitra Pinasthika Mustika Tbk (IDX: MPMX).
The acquisition includes a Federal Oil brand – an international lubricant brand, and a processing plant in Cilegon, West Java that produces 700,000 barrels of oil per year, according to the company’s official statement released on Sunday (29/4).
ExxonMobil expects the transaction to be wrapped up in the third quarter of 2018, if not earlier.
“Asia Pacific is one of the fastest growing lubricants markets in the world. This acquisition, combined with our existing premium Mobil lubricant brand, will help us continue to grow and better serve customers in Indonesia,” said Bryan Milton, president of ExxonMobil Fuels & Lubricants Company in official statement.
MPMX said in a statement, closing of the deals which is subject to conditions including relevant regulatory and shareholders’ approval. The company did not disclosed the value of the deals.
It said, a certain portion of the proceeds of the transaction will be reinvested into expanding the existing portfolio of businesses in order to capture previously untapped growth.
“We will also embark on strategic acquisitions that will allow us to accelerate our transformation as well as to enlarge our EBITDA. This Transaction will enable MPMX to secure a faster growth path forward so that we could create even greater value to our shareholders,” said Rudy Halim, Group CEO of MPMX.
Furthermore, he said, the transaction is subject to relevant regulatory and shareholders’ approval. Post-closing MPMX expects to continue its relationship with FKT in the distribution of its products and by offering its platform capabilities.
Founded in 1988, FKT is one of Indonesia’s leading motorcycle lubricant marketers with a nationwide distribution network supported by approximately 40 dealers, 3,200 Federal Oil Centers and more than 10,000 retailers throughout Indonesia.
The company recorded sales volume of 61.3 million liters in 2017 and contributed Rp223 million (US$16,159) profit or 12.57 per cent from MPMX’s profit last year.
Mitra Pinasthika Mustika is unit of PT Saratoga Investama Sedaya Tbk (IDX: SRTG), the investment firm owned by tycoon Edwin Soeryadjaya. The unit listed in Indonesia Stock Exchange in 2016 and now become one of the largest auto parts seler in the country.
Indonesia’s automotive industry was growing fast to serve the demand of domestic and export markets, including Vietnam. The country’s production of four-wheeled vehicles increased from 1.17 million in 2016 to 1.21 million in 2017.