Indonesia - BAT, Bentoel shareholders approve planned merger..


December 8, 2009 - Shareholders in PT British American Tobacco (BAT) Indonesia and PT Bentoel International Investama approved Friday the proposed merger of the two companies to challenge the domination of big players in the country's lucrative cigarette market.

We reported cigarette maker PT BAT Indonesia (BATI.JK) said in October 2009 it plans to merge with sister company PT Bentoel Internasional Investama (RMBA.JK) in order to create a stronger entity. At this time BAT said the merger is subject to approval from both shareholders of the companies and legal consent from the Indonesian Regulatory Authority for Indonesian Capital Market (Bapepam), the country's market watchdog. The two companies will hold shareholder meetings December 4, 2009 for the approval of the merger plan. (Indonesia - PT BAT Indonesia to merge with PT Bentoel International Investama Terbuka..)

A statement issued Friday, December 4th said 99.99 percent of shareholders in Bentoel, the country's fourth-largest tobacco company, and 86.62 percent of shareholders in BAT Indonesia, the local unit of Europe's biggest tobacco company, had approved the merger in separate extraordinary meetings.

The merger plan follows the acquisition in June of Bentoel shares by BAT Indonesia in a deal worth US$494 million. Under the deal, BAT bought 85 percent of Bentoel at a price of Rp 873 (9 US cents) a share.

The statement said that under the proposed merger, all BAT Indonesia shares would be exchanged for Bentoel shares at a ratio of 7.68 percent Bentoel shares per BAT Indonesia share.

BAT Indonesia assets and liabilities will be transferred to Bentoel on Jan. 1 next year as the surviving entity. Bentoel will remain listed on the Indonesian bourse.

The merger is expected to help BAT Indonesia diversify into kretek (clove-flavored) cigarettes and strengthen its presence in the Indonesian market, the world's fifth-largest with 250 billion cigarettes produced annually.

Kretek cigarettes account for more than 90 percent of the Indonesian market, with regular cigarettes making up the rest.

Bentoel sells both types, and its brands include Bentoel, Star Mild, X Mild and Country.

The new company will also look to challenge the three big firms that together dominate 70 percent of the market: Philip Morris International's H.M. Sampoerna (27 percent market share), Gudang Garam (22 percent) and Djarum (21 percent).

Djoko Moeljono will become president commissioner of the merged entity, while Jeremy Pike, previously BAT's director for Africa, will become president director.

The merger is still subject to approval by the market regulator, and is expected to go through in January.

Following the merger, BAT will own a 98.26 percent stake in the new company, assuming all shareholders take up the merged group's shares.

BAT Indonesia is 79 percent owned by BAT.

Reference: BAT, Bentoel shareholders approve planned merger, The Jakarta Post, 12/5/2009.

Indonesia related news briefs:
Indonesia - another protest rejecting the new cigarette excise tax..;
Indonesia - workers from small cigarette producers protest excise tax increase..;
Indonesia - cigarette industry has pledged to stage a demonstration to protest a government plan to increase excise tax.;
Indonesia - the last paradise for a puff in Southeast Asia..;
Indonesia - trade minister officials want to meet with US counterparts to discuss ban on clove cigarettes..;
Indonesia - PT BAT Indonesia to merge with PT Bentoel International Investama Terbuka..;
Indonesia - missing tobacco regulation in approved Health Law..;
Indonesia - section on tobacco in health bill disappears..;
Indonesia - Constitutional Court by close vote rules that tobacco ads can continue..;
Indonesia - parent smoking can negatively affect the nutrition of children..;
Indonesia - new council member suspect in cigarette fraud case..;
Indonesia - an NGO commission assists cigarettes must be banned in films..
Indonesia - a paradise for tobacco companies..
Indonesia - after buying cigarettes very little left for food..;
Indonesia - will they ratify the first world public health treaty..;
Indonesia - last paradise to smoke in public places in Southeast Asia..;
Indonesia - Industry minister to close tobacco to new foreign investment..;
Indonesia Finance Ministry to cap tax deductions for tobacco companies..;
Indonesia - Smoking hits poor families the hardest, making the poor even poorer..;
Indonesia - Cigarette makers defy crisis, grows stronger..;
Indonesia - government may raise cigarette excise tax next year..;
WHO - Indonesia is crying out for your help..;
Indonesia - dispute with U.S. over banning the use of clove in cigarettes..;
Indonesia 'cash cow' for Philip Morris International..;
Tobacco industry has long targeted young people as "replacement smokers";
Indonesia - district court dismisses request to ratify FCTC..;
Asean Countries - Tobacco Industry Blocking Global Treaty On Tobacco..; Indonesia - farmers hold rally protest tobacco controls..;
Indonesia - tobacco farmers reject Islamic council's edict..;
Indonesia - Ulema Council - debate results is split on smoking..;
Indonesia - Withdraw Sponsorhip of Another Rock Concert..;
Indonesia to increase tax on tobacco products..;
Semarang, Indonesia - Cigarette Smoking Areas to be Prepared..;
Jakarta, Indonesia - Malls help enforce non-smoking ban..;
Indonesia - federal anti-smoking laws in one year - MAYBE..;
Indonesia - NGO's (non-government organizations) Demand the Government Ratify WHO's FCTC.;
Indonesia to raise cigarette tax by 6 to 7% in 2009..;
Surabaya, Indonesia - anti-smoking bylaw 10/2009 - FOR REAL??
Indonesians smoking more than ever before..;
Indonesia further rise in the excise tax would hurt the cigarette industry..;
Alicia Keys - Jakarta Concert (July 31st) tobacco companies forced to withdraw sponsorship.. and
Most Indonesians support moves to ban tobacco advertisements...

0 comments: