DBS-Danamon Deal Seen Imperiled by Ownership Rules: Real M&A

Southeast Asia’s largest banking takeover is turning into the emerging-market deal that traders bet is the most likely to unravel, as Indonesia considers restricting foreign ownership of its lenders.

Shares of Jakarta-based PT Bank Danamon Indonesia closed yesterday 21 percent below a 7,000 rupiah per share offer from Singapore’s DBS Group Holdings Ltd., the biggest discount since the 66 trillion rupiah ($7 billion) takeover was announced last month, according to data compiled by Bloomberg. The gap is the widest for a pending deal of more than $1 billion in any developing nation, indicating arbitragers are convinced the transaction is the least likely to be completed, the data show.