JAKARTA (TheInsiderSTories) – Singapore’ DBS Group Holdings Ltd. is considering joining the race to acquire PT Bank Permata Tbk (IDX: BNLI), Bloomberg reported today (10/09). The Indonesian lender owned by British’ Standard Chartered Plc and PT Astra International Tbk (IDX: ASII), each hold 44.56 percent stakes.
Its reported, DBS is working with an adviser on the possibility of bidding for the bank shares, which has a market value of about US$2.4 billion. Such a move would pit DBS against both its Singaporean competitor Oversea-Chinese Banking Corp. (OCBC) and Japan Tokyo-based Sumitomo Mitsui Corporation Bank (SMCB), which are also interested in acquiring the Indonesian bank.
If the bid moves ahead, it would be DBS’ second attempt to acquire a substantial Indonesian bank. In 2013, it was forced to abandon a $6.5 billion bid to take over PT Bank Danamon Indonesia Tbk (IDX: BDMN) after a change in the rules on foreign ownership. Danamon was acquired earlier this year by other Japan lender, Mitsubishi UFJ Financial Group Inc.
Since losing out on Danamon, DBS Chief Executive Officer Piyush Gupta said in September he remains open to “bolt-on” acquisitions if they fit with a strategy of augmenting digital services with a physical presence.
Previously local media reported, Sumitomo and OCBC will buy Bank Permata shares from PT Astra International Tbk (IDX: ASII) and Standard Chartered Bank (Stanchart), each of which holds 44.56 percent of shares or means 12.49 billion units of Bank Permata shares. The remaining 3.04 billion shares or 10.88 percent are still owned by public investors.
If Sumitomo successfully acquires Bank Permata, then SMBC has the potential to merge the bank with a local bank that has already been acquired, namely PT Bank BTPN Tbk (IDX: BTPN). If Bank Permata merges with BTPN, then the merged bank has the potential to become a BUKU IV bank with core capital of over Rp30 trillion ($2.13 billion).
Previously, OCBC Singapore claimed has same interest to acquire a 90 percent stake in Bank Permata worth $1.9 billion. Last February, Standard Chartered said that investment in Bank Permata was not a priority for the company and gave a signal to sell its shares.
Indonesian state-owned lender, PT Bank Mandiri Tbk (IDX: BMRI) had been also rumored to acquire Bank Permata. However, this was canceled because there was no agreement on the selling price between Bank Mandiri and the two controlling shareholders.
Chairman of the Board of Commissioners of the Financial Services Authority Wimboh Santoso said the cancellation was not a cause for concern. Because there are still many other parties who can replace the position of Bank Mandiri to acquire BNLI shares.
In addition to Bank Mandiri, two Japanese financial institutions are also reportedly interested in acquiring Bank Permata. The two institutions are Mizuho Financial Group and Sumitomo Mitsui Financial Group.
As of June, Permata had 317 branches serving more than 2 million customers in 62 Indonesian cities.
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