British American Tobacco acquires control of Indonesia’s Bentoel
17 June 2009
British American Tobacco today acquired from Rajawali Group and other shareholders an 85 per cent stake in Indonesia’s fourth largest cigarette maker PT Bentoel Internasional Investama Tbk for US$494 million (GBP303 million).
The price is equivalent to IDR873 per share, a premium of 20 per cent over Bentoel’s closing price of IDR730 per share on 15 June 2009. A public tender offer for the remaining shares will be announced in due course and is expected to be completed by the end of August 2009.
Assuming that all the shares are tendered, the overall transaction would value 100 per cent of Bentoel at approximately US$580 million (GBP356 million).
John Daly, British American Tobacco’s Asia-Pacific Director, said: “This transaction represents an excellent strategic opportunity to enter the very large and growing Indonesian kretek market and will provide a platform for future growth.”
Indonesia is the world’s fifth largest tobacco market by volume, with sales of around 250 billion cigarettes a year, and a global top ten market by profit.
The kretek segment accounts for some 93 per cent of the market. Kreteks are cigarettes made from tobacco and cloves and are produced by machine or hand rolled. Bentoel’s key kretek brands include Star Mild, X Mild and Sejati.
In 2008 Bentoel sold 17.7 billion cigarettes, representing approximately seven per cent of the market.
Bentoel’s earnings before interest, tax, depreciation and amortisation for the 12 months to 31 March 2009 were US$53 million (GBP32 million). It had net debt of US$164 million (GBP101 million) at 31 March 2009.
British American Tobacco’s existing business, PT BAT Indonesia Tbk, has an approximate two per cent market share and competes only in the white cigarettes market.
British American Tobacco Press Office
David Betteridge / Catherine Armstrong / Elif Boutlu
+44 (0) 20 7845 2888 (24 hours)
Ralph Edmondson / Rachael Brierley / Maya Farhat
+44 (0) 20 7845 1180 / 1519
British American Tobacco Asia-Pacific Region
Simon Millson, Regional Head of Corporate and Regulatory Affairs
+852 9189 2213