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Indofood Agri Resources is the palm oil unit of the Indonesian food giant. The price range represents 9.8 to 13.6x 2005 eps, according
to its prospectus.
The deal, arranged by CIMB, Credit Suisse
Indofood Agri saw its net earnings drop 4.8% to 543 billion rupiah in 2005. For the first half of 2006, its profits plummeted 18.2% to 235 billion rupiah due to higher raw material and fuel costs.
However, net earnings for the third quarter were more than double those of the second quarter, thanks to lower financing charges and the strengthening of the rupiah.
It plans to invest US$160 million to develop 70,000 hectares of its land bank into oil palm plantations by 2009. It also plans to invest US$60 million to boost its production capacity.
Indofood is controlled by the Salim family, which had close links to Indonesia's former President Suharto. The Salim group was forced to sell off many of its assets after the Asian financial crisis, but kept control of Indofood.
Indofood Agri Resources Ltd., a unit of Indonesian food giant Indofood Sukses Makmur Tbk, aims to raise up to US$276 million in an IPO, a source close to the deal said on Friday.
The firm, which kicked off its road show on Friday, is offering 338 million shares at $0.90 to $1.25 each. Book building will last until Feb 5. and a trading debut is expected on Feb. 14.
After the RTO is done, IndoAgri is offering new shares to investors in order to meet requirements regarding the spread and distribution of shares as well as raise funds for IndoAgri and its subsidiaries.
Price drop since there is Capital Reduction (10shares becomes 1share for those still holding on to it)?
I see the Tsunami is heating on this counter?
Indofood Sukses Makmur Tbk's
The deal is structured as a reverse takeover, where the world's biggest instant noodle maker gets a 98.67% stake in CityAxis. CityAxis, to be renamed Indofood Agri Resources Ltd. (IndoAgri), will then offer an approximately 30% stake to the public, allowing Indofood to raise funds through the Singapore stock market.
The US$250 million deal comes as Indonesia, the world's second largest palm oil producer and exporter after Malaysia, has been boosting its output of the commodity partly to meet the increasing demand for biofuel as an alternative source of energy.
"After the reverse take-over is done, IndoAgri will offer new shares to investors in order to meet requirements regarding the spread and distribution of shares as well as raise funds for IndoAgri and its subsidiaries," Indofood said in a statement.
"The funds will be used to develop and expand Indofood plantations," Indofood director Thomas Tjhie told reporters. Indofood is controlled by the Salim family, which had close links to Indonesia's former President Suharto.
After the 1997-98 Asian financial crisis, the Salim group was forced to sell off many of its assets, including Bank Central Asia
that mean share dilution...
looking at Wilmar guess that the way to go for quick capital gain.
looking at Wilmar guess that the way to go for quick capital gain.
OK, this is the thread.
A bit more info - according to their SGX annoucement, they will be doing a private placement of 435 million shares, after the share consolidation (price not determined yet), and the total number of shares will then increase from aprox 1 billion to 1.4 billion approx. All these will probably take place next yr janm 07 or thereabout.
This counter has potential. However, it has a smaller plantation land bank than Wilmar. A catalyst would be a merger with another company.
another making of Wilmar?
that was the original name i thought? it was then changed to ISG...
Hi, change of name to "CityAxis Holdings Limited"
Is this counter awaiting name change and temporarily suspended? Can't find it anymore.
Worth watching out for.
Salim Group is making its 2nd investment in 2 days in S'pore-listed companies after Food Empire.
Indonesian food group Indofood Sukses Makmur is listing its oil palm plantations in Singapore by selling the business to ISG Asia for $392.7m. Indofood, the world's biggest instant noodle maker, is injecting the business, which also includes its edible oils and fats refining operations, into ISG.
Indofood is controlled by the Salim family, which had close links to Indonesia's former President Suharto.
ISG, which is worth $9.9m on the stock market, will be renamed Indofood Agri Resources Ltd. and will sell 9.982 billion new ISG shares to Indofood at $0.03934 each.
"The proposed acquisition will transform ISG Asia into the listed holding company of an established, major, vertically integrated producer of edible oils and fats in Indonesia with considerable interests in oil palm plantations," said ISG Asia CEO Alex Yeunh Oi Siong.
ISG said the acquisition would leave Indofood with 98.67% of the enlarged issued share capital. It is also proposing to consolidate every 10 shares into 1 share. It said either new or existing shares, or a mix of the two, would then be sold to investors in order to meet stock exchange requirements for free float as well as to raise funds.
ISG said its stock market capitalisation could potentially increase to around $1b as a result of the deal.
The businesses that Indofood is proposing to inject into ISG comprise plantation landbank of about 138,000 ha, of which about half are planted with oil palms. It also has palm oil mills and refineries.
As for its edible oils and fats business, it has a market share of 38.2% in Indonesia in 04, according to the lastest estimates available.