CVC Capital Partners and co-investors in Indonesia’s Link Net are reportedly targeting about US$200m less from their planned sale of shares in the broadband and cable TV operator following weak investor demand.
The shareholders now aim to raise about…
CVC Capital Partners and co-investors in Indonesia’s Link Net are reportedly targeting about US$200m less from their planned sale of shares in the broadband and cable TV operator following weak investor demand.
The shareholders now aim to raise about Rp8.2trn (US$450m) from the sale, down from about Rp5.5trn (US$650m) previously, according to a Reuters report citing a term sheet.
The size of the offering has been reduced from 40% to 30% of Link Net stock, while the price per share has dropped from Rp6,200-Rp6,700 (US$0.51-US$0.55) to Rp6,000 (US$0.50), the report stated.
Link Net shares remained flat at Rp7,025 (US$0.58) on the Indonesia bourse at closing today.
Volatility in global financial markets along with concerns that new Indonesian President Joko Widodo, who took office this week, may not be able to deliver promised reforms smoothly were cited as reasons for the smaller offering.
CVC was not immediately available for comment on the matter, while co-shareholder First Media, part of Indonesian conglomerate Lippo Group, has declined to comment.
Bookbuilding for the sale began on 13 October, with selling shareholders offering about 1.22 billion shares in total.
First Media, which has a 41% stake in Link Net, initially said it would sell at least 337 million shares, equal to an 11% holding, and expected to become its largest single shareholder after the transaction.
However, today’s report stated that First Media will cut its stake to 36%, while CVC, which owns 49% of Link Net shares via subsidiary Asia Link Dewa, will reduce its holding to 33.4%.
The transaction is still expected to be the largest share sale in Indonesia this year and will provide a test case for investor sentiment in the country.
Nine cornerstone investors, including US fund managers BlackRock and Och-Ziff Capital Management, reportedly pledged US$257m in commitments.
Goldman Sachs Investment Strategies, Malaysian investment firm CMY Capital, Neuberger Berman, William Blair, Morgan Stanley Investment Management and Columbia Wanger Asset Management were reportedly also among those who agreed to buy shares.
Goldman Sachs and Credit Suisse are the global coordinators for the sale, according to a recent Bloomberg report. CIMB, Ciptadana Securities, BNP Paribas and Deutsche Bank are also reportedly working on the transaction.
CVC describes Link Net as the second-largest fixed broadband and cable TV operator in Indonesia with a network passing more than 500,000 homes across Greater Jakarta, Surabaya and Bali.
