SINGAPORE--CVC Capital Partners will raise US$1.3 billion from
selling nearly half of its stake in Indonesian retailer Matahari
Department Store (LPPF.JK), as the private equity firm cashes in on
its investment in one of Southeast Asia's fastest-growing
markets.
CVC, which owns about 80% of Matahari, will sell 1.17 billion
shares for 10,850 Indonesian rupiah each (US$1.12), the mid-point
of its indicated price range of 10,000 rupiah-11,250 rupiah a
share, people with knowledge of the deal said Friday.
The share sale, which started earlier this month, has so far
been nearly five times subscribed and books in Asia are due to
close later in the day, one of the people said, indicating that
investor appetite for assets in Southeast Asia remain strong.
Indonesia has become an attractive market for foreign investors
due to its rising middle class and booming economic growth. The
World Bank estimates 130 million Indonesians qualify as middle
class, defined as those who spend between $2 and $20 a day. The
country's economy is expected to grow by up to 6.8% this year,
which should boost incomes and consumer spending as well.
Matahari is Indonesia's largest department-store chain by value
of sales, with a 32% market share. The chain, which sells
affordable fashion, has 116 stores across Indonesia, according to
its share-offer document. CVC bought an 80% stake in Matahari in
April 2010.
Indonesia's Riady family owns most of the rest of Matahari
Department Store's shares, with a mere 1.8% in public hands.
Indonesia doesn't require a minimum public float for listed
companies.
CIMB Bank, Morgan Stanley, UBS and Standard Chartered Bank are
among the banks that advised CVC on the sale.
Write to P.R. Venkat at venkat.pr@dowjones.com
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