Mandiri eyes deal for StanChart-backed rival

JAKARTA • Indonesia’s state-run PT Bank Mandiri Tbk is exploring a takeover of PT Bank Permata Tbk, the rival lender backed by Standard Chartered plc (StanChart), people with knowledge of the matter said.

Mandiri is working with Morgan Stanley on the potential deal, according to the people, who asked not to be identified because the information is private.

It is considering buying control of Permata and then merging the lender with Mandiri itself or its unit PT Bank Mandiri Taspen Tbk, known as Bank Mantap, the people said.

Shares of Permata have risen 75% in Jakarta trading this year, giving it a market value of about US$2.2 billion (RM8.97 billion). Mandiri will aim to complete the potential acquisition this year if it decides to proceed, one of the people said.

StanChart said last week its Permata investment is no longer considered core, signalling it may be getting ready to dispose of the stake. It also named Indonesia among four countries where the bank is focused on reducing costs and engineering a long-awaited turnaround.

Mandiri hasn’t started formal talks on a deal, and it could still opt for a smaller stake or decide against pursuing a transaction, the people said. StanChart and Jakarta-listed conglomerate PT Astra International Tbk each own about 44.6% of Permata, data compiled by Bloomberg show.

Representatives or officials at Astra, Mandiri and StanChart declined to comment. A representative for Permata said the lender isn’t in a position to comment on shareholder matters. Kontan reported on Monday that Mandiri is open to acquiring a stake in Permata, citing Mandiri corporate secretary Rohan Hafas.

Permata, the 11th largest Indonesian bank by assets, reported net income of 900 billion rupiah (RM260.83 million) last year, according to data compiled by Bloomberg. — Bloomberg