TIDMSTAN
RNS Number : 6695W
Standard Chartered PLC
12 December 2019
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION
FOR IMMEDIATE RELEASE
Standard Chartered PLC
Disposal of interest in PT Bank Permata Tbk
12 December 2019
INTRODUCTION
Standard Chartered announces that its wholly owned subsidiary
Standard Chartered Bank ("SCB") and Astra have entered into the
Agreement with Bangkok Bank on 12 December 2019 to sell their
respective 44.56% equity interests (89.12% in aggregate) in
Permata.
The purchase price will be 1.77 times Permata's Book Value based
on the most recent financial results published prior to completion.
The estimated consideration payable to SCB in cash is approximately
IDR 19 trillion (US$1.3 billion) based on Permata's Book Value as
at 30 September 2019.
Completion of the Transaction is conditional on the satisfaction
of certain conditions, including approval by the Purchaser's
shareholders and receipt of regulatory approvals in Indonesia and
Thailand. Upon completion of the Transaction, SCB will cease to
have any equity interest in Permata.
Standard Chartered announced on 26 February 2019 that its 44.56%
equity interest in Permata was no longer core and that it had
chosen to focus on its wholly-owned banking presence through
Standard Chartered Bank Indonesia for its ongoing operations and
future growth in Indonesia. Divesting the stake in Permata is an
important part of Standard Chartered's capital optimisation plans,
an update on which will be provided at its full-year results on 27
February 2020.
Bill Winters, Group Chief Executive of Standard Chartered
said:
"The sale of our stake in Permata will allow us to focus on our
wholly-owned business in the large and strategically important
Indonesian market; and will release capital for reinvestment or
return to shareholders. This transaction further demonstrates our
focus on executing the refreshed strategic priorities we announced
earlier this year, at pace."
THE AGREEMENT
The Sellers entered into the Agreement on 12 December 2019 with
the Purchaser, pursuant to which the Sellers have agreed to sell,
and the Purchaser has agreed to purchase, the Sellers' respective
44.56% equity interests (89.12% in aggregate) in Permata.
The principal terms of the Agreement are summarised as
follows:
Parties to the Agreement
(1) Standard Chartered Bank (as one of the Sellers)
(2) PT Astra International Tbk (as one of the Sellers)
(3) Bangkok Bank Public Company Limited (as the Purchaser)
Consideration
The estimated aggregate consideration for the Transaction is
approximately IDR 37 trillion (US$2.6 billion), equivalent to IDR
1,498 per Permata share, representing 1.77 times Book Value (based
on Permata's financial results as at 30 September 2019). The
estimated consideration for the sale of SCB's 44.56% equity
interest in Permata is approximately IDR 19 trillion (US$1.3
billion).
The actual price to be paid in cash at completion will be 1.77
times Permata's Book Value based on the most recent financial
results published prior to completion.
Completion
Completion of the Transaction will take place on the tenth
business day after the date of confirmation that each of the
conditions under the Agreement is fulfilled or waived, or on such
other date as agreed by the parties. Completion of the Transaction
is subject to certain conditions, including approval by the
Purchaser's shareholders and receipt of the applicable regulatory
approvals in Indonesia and Thailand, which the Sellers and
Purchaser hope to achieve by the end of 2020.
FINANCIAL IMPLICATIONS TO STANDARD CHARTERED OF THE
TRANSACTION
The net asset value of SCB's 44.56% equity interest in Permata
was US$0.8 billion as at 30 September 2019. For financial reporting
purposes, Standard Chartered's interest in Permata is recorded
using the equity method of accounting and held as an investment in
an associate. The net profits attributable to Standard Chartered's
interest in Permata included in the consolidated financial
statements for each of the two financial years ended 31 December
2017 and 2018 were US$29 million and US$26 million, respectively
(profit impact to Standard Chartered is the same both on a pre-tax
basis and post taxes and extraordinary items).
Based on Standard Chartered's financial results for the period
ended 30 September 2019:
-- It would record, upon completion of the Transaction an
estimated gain of approximately US$0.5 billion, being the estimated
consideration of US$1.3 billion less the US$0.8 billion net asset
value.
-- The Transaction would increase its common equity tier 1
capital by approximately US$0.1 billion, reduce risk-weighted
assets by around US$9.5 billion and increase its common equity tier
1 capital ratio by around 50 basis points.
As the Transaction is expected to close at a future date, the
actual consideration, the actual gain amount, and the actual common
equity tier 1 capital impact will be determined at completion.
INFORMATION ON THE PARTIES
(i) Information on Standard Chartered
Standard Chartered is a leading international banking group,
with a presence in 60 of the world's most dynamic markets, and
serving clients in a further 85. Standard Chartered's purpose is to
drive commerce and prosperity through its unique diversity, and its
heritage and values are expressed in its brand promise, Here for
good.
Standard Chartered is listed on the London and Hong Kong Stock
Exchanges as well as the Bombay and National Stock Exchanges in
India.
(ii) Information on Astra
PT Astra International Tbk was established in 1957 in Jakarta as
a general trading company under the name Astra International Inc.
In 1990, for the purpose of the company's initial public offering
(IPO), the name of the company changed to PT Astra International
Tbk, followed by listing its shares on the Indonesia Stock Exchange
under the ticker code ASII.
Astra has developed its business by implementing a business
model based on synergies and diversification within seven business
segments, consisting of: 1) Automotive, 2) Financial Services, 3)
Heavy Equipment, Mining, Construction & Energy, 4)
Agribusiness, 5) Infrastructure and Logistics, 6) Information
Technology and 7) Property.
Astra conducts business operations in all parts of Indonesia
under the management of more than 230 subsidiaries, joint ventures
and associates companies, and was supported by more than 226,000
employees, as of September 2019.
As one of the largest national business groups today, Astra has
built a strong reputation through offering a range of quality
products and services, taking into account the implementation of
good corporate governance and environmental governance. Astra
always aspires to be the pride of the nation that participates in
efforts to improve the welfare of the Indonesian people.
For further information, please visit www.astra.co.id &
www.satu-indonesia.com
(iii) Information on Permata
Permata is one of the leading banks in Indonesia with total
assets of approximately US$10.9 billion and total shareholders'
equity of approximately US$1.7 billion as of Permata's quarterly
report as at 30 September 2019. For the 9-month period ended 30
September 2019, Permata reported net income of approximately US$77
million.
Headquartered in Jakarta, Permata has a network that is spread
across 62 cities with over 332 outlets (including branches and
mobile branches) and nearly 7,700 employees. Permata offers banking
products and services in Indonesia to help people and companies to
succeed, creating wealth and growth through its retail banking, SME
and wholesale businesses.
Permata is listed on the Jakarta Stock Exchange under the symbol
'BNLI'.
(iv) Information on Bangkok Bank
Bangkok Bank, established in 1944, is one of Southeast Asia's
leading regional banks and Thailand's largest bank by deposits and
shareholders' equity. It has more than 17 million customer accounts
and close to 1,200 branches nationwide and total assets of US$105
billion as of 30 September 2019. Internationally, Bangkok Bank has
the largest overseas branch network of any Thai bank, with 31
overseas locations in 14 economies, including China, Cambodia, Hong
Kong, Indonesia, Japan, Laos, Malaysia, Myanmar, the Philippines,
Singapore, Taiwan, Vietnam, the United Kingdom, and the United
States.
DEFINITIONS
"Agreement" the share purchase agreement dated 12 December 2019
between the Sellers and the Purchaser
"Astra" PT Astra Indonesia Tbk
"Board" the board of directors of Standard Chartered PLC
"Book Value" the shareholders' equity balance in Permata
"Director(s)" the director(s) of Standard Chartered PLC
"IDR" Indonesian Rupiah, the lawful currency of Indonesia
"Permata" PT Bank Permata Tbk
"Purchaser" or "Bangkok Bank" Bangkok Bank Public Company Limited
"SCB" Standard Chartered Bank, a wholly-owned subsidiary of
Standard Chartered
"Sellers" SCB and Astra
"Standard Chartered" Standard Chartered PLC
"Transaction" the proposed sale by the Sellers of their combined
89.12% stake in Permata to the Purchaser pursuant to the
Agreement
"US$" United States dollars, the lawful currency of the
United
States of America
----------------
Note:
In this announcement, the conversions of IDR into US$ have been
made at the rate of IDR14,250 to US$1. Such conversions are for
reference only and should not be construed as representations that
the IDR amount could be converted into United States dollars at
that rate.
For further information, please contact:
Media contact:
Julie Gibson
Email: Julie.gibson@sc.com
Phone: +44 20 7885 2434
Media contact:
Christina Soon
Email: christina.soon@sc.com
Phone: +65 6596 6284
Investor relations contact:
Mark Stride
Email: mark.stride@sc.com
Phone: +44 20 7885 8596
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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