Maybank to sell stake in Indonesia's BII, appoints UBS

  • Business
  • Tuesday, 17 Jan 2012

JAKARTA: Malayan Banking Bhd (Maybank), Malaysia's biggest lender by assets, has appointed UBS to handle the sale of a stake in its banking unit, PT Bank Internasional Indonesia (BII), its chairman said on Monday.

Maybank is required by the Indonesian capital market regulator, Bapepam-LK, to sell down its stake in BII to at least 80 percent from 97 percent currently. It has so far managed to sell 0.5 percent of its stake in the open market.

"We're not going to sell down if we're going to make a loss compared to what we thought it should be," said Tan Sri Dato' Megat Zaharuddin bin Megat Mohd Nor, Maybank's chairman.

"We believe that at the right price people will buy the future growth...We don't think we need to give a discount," he told Reuters.

Zaharuddin, who is also BII's president commissioner, said the bank will not sell BII's stake below 510 rupiah per share, the price it paid to buy the bank in 2008.

That means that Maybank could raise at least 4.8 trillion Indonesian rupiah ($528.63 million) from the stake sale, based on a Reuters calculation.

Maybank acquired BII in 2008 from Singapore's Temasek at a record of 4.7 times book, valuing the deal at $2.7 billion. BII currently traded at 3.1 times book, according to Thomson Reuters' Starmine data.

It drew criticism from the market and from the Malaysian central bank with critics saying Maybank was overpaying due to seven previous Indonesian M&A banking deals paying an average of three times book value.

Shares of BII, which has a market capitalisation of $2.6 billion, closed down 1.2 percent to 420 rupiah on Monday.

Maybank "will look for appropriate shareholders" to buy part of the 20 percent stake it needs to sell, Zaharuddin said.

BII on Monday changed its name to PT Bank Maybank Indonesia, subject to approval from the central bank and the government.

($1=9,080 rupiah)

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