Dyviacom Intrabumi Takes Over Salim Stake in Three Retail Companies
PT Dyviacom Intrabumi Tbk, an Indonesian internet services provider, has announced to leave the information technology sector as it has not shown significant growth and instead focus on Indonesia's lucrative (food) consumption sector. For that reason it will purchase large stakes in three companies that are engaged in the country's food industry: Indomarco Prismatama, Fast Food Indonesia, and Nippon Indosari Corpindo. The combined costs amount to IDR 6.7 trillion (USD $690.7 million).
Dyviacom Intrabumi will obtain a 31.5 percent stake in Nippon Indosari Corpindo through the purchase of 318 million stocks that are currently held by Treasure East Investments Limited. Nippon Indosari Corpindo is Indonesia’s largest producer of bread products and the country's only bread producing company that is listed on the Indonesia Stock Exchange (IDX). It controls about 90 percent of the country's production of bread products. Its Sari Roti line is a well-known brand in Indonesia.
Dyviacom will take over 165 million shares (equivalent to 35.8 percent of total stock equity) of Fast Food Indonesia, which are currently in the possession of Megah Eraraharja. Fast Food Indonesia is the sole franchise holder of the Kentucky Fried Chicken (KFC) brand in Indonesia and operates more than 400 restaurant outlets throughout Java, Indonesia's most populous island.
Lastly, Dyviacom will buy 738 million shares of Indomarco Prismatama (Indomaret), equivalent to 40 percent of Indomaret's stock equity. Indomaret is Indonesia's largest mini-market operator but is not listed on the stock exchange.
Total value of these three purchases is IDR 6.7 trillion (USD $690.7 million). The Salim Group, Indonesia's biggest conglomerate, controls Indomaret, Treasure East Investments Limited, and Megah Eraraharja. It is reported in media that the Group's move to sell its stakes in the three companies is a move of consolidation.
Dyviacom, which will change into an investment company, aims to raise IDR 7 trillion (about USD $720.4 million) in a rights issue in June in order to be financially able to buy the shares in the three retail companies. Dyviacom planned an extraordinary meeting of shareholders on 24 May 2013.
On 22 April 2013, the Indonesia Stock Exchange temporarily suspended trading of Dyviacom's stocks (DNET) as there had been an unexplainable 142 percent increase in its share price.