Bosowa Corporation Completed Acquisition of PT Bank Bukopin Tbk.

May 07, 2015

Mergers & Acquisitions


Background

Bosowa Corporindo, a leading conglomerate founded by Aksa Mahmud in 1973, completed the acquisition of Bank Bukopin, a public listed mid-sized commercial bank founded in 1970 and became the largest single shareholder with 30 % ownership interest for an approximate total investment of IDR 3 Trillion.  Bank Bukopin, whose previous controlling shareholder prior to the acquisition was Kopelindo, a cooperative for Bulog’s employees (the procurement agency of Indonesia), was largely owned by the public with each shareholder holding less than 5%.   Bosowa Corporindo, a valued client, appointed MDC as the legal advisor during the acquisition. 

The Deal

In 2013, Bosowa began acquiring shares of Bukopin through Kopelindo and Yabinstra, a foundation owned by Bulog and subsequently took over 14 % of Bank Bukopin.  At the end of 2013, Bosowa Corporindo participated in a rights issue of Bank Bukopin and increased its shareholder interest to 18.57 %.  Based on the Binding Shares Purchase Agreement between Kopelindo and Bosowa Corporindo on 29 November 2013, Bosowa Corporindo became committed to acquire shares of Bukopin from Kopelindo with a maximum limit of 30 % ownership interest.  On April 2015, Bosowa completed the terms of the Binding Shares Purchase Agreement and became the majority and controlling interest owner of Bank Bukopin.

Bosowa’s intention in owning shares of Bukopin originated from its vision and mission in developing small and medium enterprise in particular for Eastern Indonesia. The acquisition will strengthen the partnership between Bosowa and Bukopin and enabled both institutions to remain focus in developing the small and medium enterprise market in Eastern and also Central Indonesia. Bank Bukopin, who already owns branches in Kiang, Makassar, Parepare and Manado, plans to expand further into Central Sulawesi, Maluku and Papua.  From the acquisition, Bank Bukopin would receive additional capital which would be utilised for market expansion.   Bosowa also owns 7.63 % owning interest in PT Bank QNB Indonesia Tbk as of 31 March 2015.

The Result

The new capital structure after the acquisition becomes: Bosowa Corporindo 30 %, Kopelindo 18.09%, Government of Indonesia 11.43 % and Public 40.48 %.  CIMB Securities was appointed as the main underwriter/book runner during the transaction.