Salim Group, Malaysian CAB Cakaran Set Up Poultry Farming in Indonesia

Photo by Japfa Comfeed

JAKARTA (TheInsiderStories) – Indonesia conglomerate company Salim Group through its unit KMP Private Limited, an investment holding company based in Singapore, set up a joint-venture (JV) integrated poultry farming project in Indonesia with Malaysian CAB Cakaran Corp, Bhd.

The construction of the entire farm will take up to five years. The Indonesian operations will have the capacity to produce some four million broilers per month and three million eggs per day.

In the statement at Kuala Lumpur Stock Exchange on Sunday (5/11), CAB Cakaran expects the kick off the new project in the first half of 2018. This will mark CAB’s first foray into the Indonesian market as well as the layer business.

Under the agreement, the KMP Private Limited would set up and hold a 90 per cent stake in the new JV and CAB Cakaran to hold 10 per cent. However, the malaysian food producer will have the option to increase its shareholding up to 30 per cent in the next three years after the initial set-up, depending on its financial condition.

In January, 2016, Salim Group has bought a 9.1 percent stake or 15.06 million shares in CAB Cakaran through a private placement at RM2.07 (Rp6,603.22) a piece. CAB Cakaran and Salim Group has formed the JV with KMP Private on Dec. 8, 2015.

To date, the Salim Group, via its entity Plant Wealth Holdings Ltd., holds a 17.12 per cent stake in CAB Cakaran and Chuah family remains as the largest shareholder of CAB Cakaran with a cumulative 47.46 per cent stake in the group.

Vice President Director of PT Indofood Sukses Makmur Tbk (IDX: INDF) Franciscus Welirang has said the JV is not consolidated with INDF. Currently, Indofood has a cattle feed factory in collaboration with PT Japfa Comfeed Indonesia Tbk (IDX: JPFA) in Medan, North Sumatra. There is also a pig livestock feed on Pulau Bulan, Riau.

Commenting on the corporate action, BNI Securities analyst Ankga Adiwirasta said, the entry of Salim Group into the animal feed business is a positive thing.

He considered, animal feed has a good prospect. But, this business can be constrained corn supply and price fluctuations. The rupiah exchange rate also affects the price movement of maize.

Recently Salim Group is buying out the entire stake of a local e-commerce platform Elevania from its previous owners Indonesian mobile phone operator PT XL Axiata Tbk and Singapore e-commerce firm SK Global Planet Holdings Pte. Ltd.

Joined with South Korean’s Lotte Group, the conglomerate has established a joint venture to expand its retail business by opening ‘iLotte’, an online shopping mall, as a full-range e-commerce site with fashion, electronics, household goods, and groceries in the country.

It’s unit, PT Indofood CBP Sukses Makmur Tbk (IDX: ICBP) announced to acquire 49 percent of Japan’s Asahi Group Holdings Ltd in Asahi Group Holdings Southeast Asia Pte Ltd (Asahi Singapore) on Oct. 2.

Asahi Singapore has agreed to divest all its stake in PT Asahi Indofood Beverage Makmur (AIBM) and PT Indofood Asahi Sukses Beverages (IASB), a joint venture between two companies. Currently, Indofood have 49 percent in AIBM and 51 percent in IASB.

It said, the terms remain to be negotiated. Currently, the combined worth of the two companies is 2.5 trillion rupiah (US$185 million).

Currently, three major cattle feed players in Indonesia are JPFA, PT Charoen Pokphand Indonesia Tbk (IDX: CPIN) and PT Malindo Feedmill Tbk (IDX: MAIN).
The poultry meat sector in Indonesia is projected to grow up to 90 per cent by 2020 if GDP increases by 6 per cent per annum. The layer industry is also projected to grow around 60 per cent of the broiler sector.
KMP Private is an investment holding company of Salim Group having subsidiaries in Indonesia engaged in food, plantation, distribution and retail business. The investment firm was established since Feb. 2, 1981.
There, Anthoni Salim controls 67 per cent ownership and 33 per cent owned by Mariton International Limited. KMP’s total shares are worth S$255.5 million.
CAB Cakaran is a poultry feed company that also produces processed chicken, seafood and beef. CAB owns the Likes trademark in Malaysia.
Salim group, is one of Indonesia’s biggeest conglomerate with assets including INDF, the world’s largest instant noodle and PT Bogasari Flour Mills, a large flour-milling operation. The group was founded in October 1972 by Sudono Salim (16 July 1916 – 10 June 2012), also known as Liem Sioe Liong.
The Group also owns major oil plantations–about 1,000 kilometers– and logging concessions. The Group has been involved in property development and the leisure industry for around 30 years. Its businesses include hotel and resort development, golf courses, and commercial real estate.
RM1: Rp3,190,-.
Written by Linda Silaen, Email: