CPI to expand via acquisitions
Indonesia's largest poultry feed and breeding stock producer, PT Charoen Pokphand Indonesia (CPI), is set to expand its business by making six corporate acquisitions this year.
"We have scheduled a shareholders meeting for June 27 at which we will request approval for a rights issue to raise funds to finance the acquisitions," CPI finance president Thomas Effendy said on Tuesday. The rights issue was expected to raise 175.9 billion rupiah (Bt680 billion), with 165.2 billion rupiah of the total proceeds being used to finance the acquisitions. He said the company would offer its shares at 750 rupiah, with 234.61 million shares on offer. Following the rights issue, the company's total share capital will increase from 140.8 billion rupiah previously to 164.2 billion rupiah. The six companies to be acquired include four poultry breeding operations, a feed mill and a food distributor, all of which have signed acquisition agreements that are expected to be fully realised next month. Under the acquisition plan, CPI will purchase 99.9 per cent of PT Satwa Utama Raya for 51.5 billion rupiah, 99.9 per cent of PT Istana Satwa Borneo for 26 billion rupiah, 99.9 per cent of PT Vista Agung Kencana for 24 billion rupiah and 50 per cent of PT Cipta Khatulistiwa Mandiri for 9.3 billion rupiah. CPI will also acquire 99.9 per cent of two other companies, feed mill company PT Vista Grain and a distributor of Fiesta processed foods, PT Prima Food, for 14.2 billion and 23.4 billion rupiah, respectively. Effendy said the acquisitions were part of the company's efforts to achieve its target of 7.7 trillion rupiah in this year's net sales, with the acquisitions themselves expecting to contribute 350 billion rupiah. "We are already targeting around 7.35 trillion rupiah in net sales from our existing operations," he said.
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