CVC Said to Plan Sale of $1.5 Billion Matahari Stake

CVC Capital Partners Ltd., the private equity firm that owns Formula One, may seek as much as $1.5 billion from the sale of shares in retailer PT Matahari Department Store, five people with knowledge of the matter said.

The sale, potentially Indonesia’s largest stock offering in five years, may take place as soon as next month, the people said, asking not to be identified because the information is private. CVC and partner Lippo Group control 98 percent of Matahari, data compiled by Bloomberg show.

The shareholders plan to sell about 40 percent of Matahari and will retain control of the company, three people said. The sale would value Tangerang-based Matahari at more than $3 billion, two people said.

CVC is looking to exit a three year old investment as companies from Apple Inc. to Japan’s Fast Retailing Co. lay plans to open stores in Indonesia to profit from rising incomes in the world’s fourth most-populous nation. Indonesia may add 90 million people to its so-called consuming class, with spending in urban areas rising 7.7 percent a year to $1.1 trillion by 2030, McKinsey & Co. said in a report last year.

Matahari, founded in 1958, has 116 stores across Indonesia, according to its website. The company posted a 66 percent rise in net income to 771 billion rupiah ($80 million) in 2012, according to a Feb. 11 filing.

Largest Deal

Officials at CVC declined to comment on the plan. Danang Kemayan Jati, a spokesman for PT Lippo Karawaci, said he doesn’t know of any plan to sell the stake in Matahari. Officials at Matahari couldn’t be reached to comment. The sale plan was reported by the Wall Street Journal last year.

A venture between CVC and Lippo-backed PT Matahari Putra Prima bought 91 percent of the department store in January 2010 for about $772 million, and acquired the rest of the stake soon after. Matahari Department Store was a unit of Matahari Putra Prima at the time.

CVC’s sale may be Indonesia’s largest share sale since a $4.4 billion rights issue by PT Bakrie & Brothers in April 2008, data compiled by Bloomberg show. Companies raised $3.6 billion in Jakarta stock offerings last year, the data show.

CIMB Group Holdings Bhd., UBS AG, and Morgan Stanley are managing the offering, the people said.

Although the retailer is already listed on Jakarta’s stock exchange, just 54 million shares, or less than 2 percent of Matahari’s shares outstanding, are currently able to be traded, data compiled by Bloomberg show. The shares have traded on only one day in the last five months -- when 7,000 shares were bought and sold on Feb. 15, data compiled by Bloomberg show.

Photographer: Dimas Ardian/Bloomberg

A worker pushes a box of goods at PT Matahari Putra Prima's Hypermart hypermarket in Jakarta. The company posted a 66 percent rise in net income to 771 billion rupiah ($80 million) in 2012, according to a Feb. 11 filing. Close

A worker pushes a box of goods at PT Matahari Putra Prima's Hypermart hypermarket in... Read More

Close
Open
Photographer: Dimas Ardian/Bloomberg

A worker pushes a box of goods at PT Matahari Putra Prima's Hypermart hypermarket in Jakarta. The company posted a 66 percent rise in net income to 771 billion rupiah ($80 million) in 2012, according to a Feb. 11 filing.

To contact the reporters on this story: Joyce Koh in Singapore at jkoh38@bloomberg.net; Elffie Chew in Kuala Lumpur at echew16@bloomberg.net; Jonathan Browning in Hong Kong at jbrowning9@bloomberg.net

To contact the editor responsible for this story: Philip Lagerkranser at lagerkranser@bloomberg.net

Bloomberg reserves the right to edit or remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.