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BWPT to raise trillions from rights issue for acquisition
Jakarta-listed plantation firm BW Plantation (BWPT) is looking to raise between Rp 10
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akarta-listed plantation firm BW Plantation (BWPT) is looking to raise between Rp 10.54 trillion (US$879.96 million) and Rp 11.1 trillion from a rights issue to fund a planned acquisition.
In a prospectus submitted to the Indonesia Stock Exchange (IDX) Wednesday, BWPT said it planned to issue 27.02 billion new shares, priced between Rp 390 and Rp 411 apiece.
Every shareholder having one share as of Nov. 1 will have the preemptive right for six new shares offered during the issue, which will take place from Nov. 24 to 28.
According to the prospectus, if not all shareholders exercise their right, the remainder of the allocated shares will be transferred to shareholders participating in the issue.
A list of standby buyers ' consisting Rajawali Capital International, BNI Securities, Danareksa Sekuritas, Mandiri Sekuritas and Valbury Asia Securities ' will purchase any shares that remain at the same price.
The standby buyers will then offer and sell the shares to either domestic or foreign investors through a limited offering.
BWPT finance director Kelik Irwantono said as much as Rp 10.53 trillion of the funds generated would finance the 100 percent acquisition of Singapore-listed plantation firm Green Eagle Holdings Pte. Ltd.
'The remainder of the funds will be used for working capital,' he said.
Green Eagle is an affiliate of Rajawali Capital, which is part of the Rajawali Corpora conglomerate controlled by Indonesian businessman Peter Sondakh. Rajawali Corpora currently manages several business sectors, including transportation, mining and plantation.
The conglomerate already has indirect ownership, equal to 21.4 percent, in BWPT through Matacuna Group, Pegasus SP One and LGT BK (Singapore) Ltd./CLT TST AC Singapore.
Matacuna, Pegasus and LGT now have a 10.9, 9 and 1.5 percent stake, respectively, in BWPT.
The rest of the current ownership is made up by BW Investindo with 34.9 percent, Barclays Bank PLC-KS with 7 percent, JPMorgan Chase Bank NA RE Non-Treaty with 5 percent and the public with 31.7 percent.
- BWPT plans to issue 27.02 billion new shares, at Rp 390 and Rp 411 apiece
- It aims to acquire Singapore-listed plantation firm Green Eagle Holdings Pte. Ltd.
- Remaining funds will be used for working capital
The statement said that BW Investindo, Matacuna'including LGT, in which Matacuna has shares'and Pegasus would not exercise their rights, transferring them to Rajawali Capital instead.
Following the rights issue, Rajawali Capital will own a majority stake of 48.2 percent of BWPT. JPMorgan, Barclays Bank and the public will still have 5, 7 and 31.7 percent, respectively.
Meanwhile, BW Investindo will see its ownership reduced to 5 percent, Matacuna to 1.6 percent, Pegasus to 1.3 percent and LGT to 0.2 percent.
The planned acquisition is now pending shareholders' approval at the BWPT extraordinary general shareholders' meeting slated for Nov. 10.
Meanwhile, Kelik said that the acquisition of Green Eagle would boost the total size of BWPT's plantations to 419,006 hectares from the current 94,513 ha.
At the moment, BWPT's plantations are located in Central, East and West Kalimantan provinces. Those of Green Eagle are scattered in East, South and West Kalimantan and Papua provinces.
'By the end of the acquisition, we will also have a total of six palm oil mills. Green Eagle is also on its way to constructing two more mills in Kalimantan and Papua,' he added.
The IDX resumed trading of BWPT's shares on Wednesday, having suspended trading on Sept. 17, when news of the planned rights issue surfaced.
After the suspension was lifted, the shares dropped 24.6 percent to Rp 720 apiece from Sept. 16.
