It has sold a 9% stake in BII for IDR355 per share. The stake was sold to UBS AG of Switzerland. The price is below the IDR510 per share Maybank paid in 2008 when it bought into the Indonesian lender. UBS was hired by Maybank in Jan 2013 to handle the BII stake sale.
On paper, Maybank would have made a loss of IDR785 billion (rm250 million). However, a point to note is that Maybank managed to get a discount from some of the vendors in 2008. Thus, Maybank’s blended cost of acquiring BII was between IDR429 and IDR455 per share.
It had entered into a commercial arrangement for the sale where the economic exposure resulting from the disposal is being retained.
Sources say although the sale of the 9% stake is below Maybank’s cost of entry into BII, it is beneficiary to both parties. Therefore, Maybank is expected to gain other benefits.
Speculation abound that the block sold to UBS could be temporary solution to comply with the regularization that required Maybank to sell down its stake to 80% by June 30 2013.
Maybank could have sold the 9% stake in BII for a lower price than its blended and entry price cost to show that it was doing something about the divestment.
Maybank have said that there will not be any material financial impact on the group. Thus, it is not too worries about the impact on earnings.
Following the sale of the 9% stake, the free float of BII shares has increased from around 2.7% to 11.7% of its issued and paid capital. Maybank is required to sell another 8.3% in BII as the Indonesian authorities have imposed a mandatory sell down requirement to achieve a 20% public float.
It is seeking more time to fulfill the mandactory sell down of its 97.4% stake in BII to comply with the 20% public float.
When Maybank acquired its stake in BII back in 2008, the Indonesian banking authorities had acquired Maybank to sell down its stake to 80% within two years of the completion of the tender offer which in effect was Dec 2010.
Currently (June 2013), BII only contributes 7% to Maybank’s earnings…
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