CVC exits Matahari with $227m block

Shareholders including two controlled by CVC Capital Partners sold shares in Indonesia’s largest shopping mall operator on the back of strong operational figures.

CVC Capital Partners and another shareholder of Indonesia's Matahari Department Store capitalised on the stock’s strong market performance by raising Rp3 trillion ($227 million) through an accelerated bookbuild.

A trio of shareholders including Asia Color, Meadow Asia, and Conrex offered a total of 125.2 million shares in Matahari -- 4.3% of the retail chain's outstanding share capital -- at an indicative price range of Rp17,000 to Rp17,800 each, or a discount of 5.3% to 9.6% to its closing price. 

Private equity firm CVC is the majority owner of Asia Color and Meadow Asia.

Sole bookrunner Credit Suisse timed the sale well as the stock is just slightly off its record high after an impressive set of quarterly results just last month. Matahari, Indonesia’s biggest shopping mall operator, reported a 32% year-on-year increase in net income to Rp244 billion in the first three months of the year thanks to robust sales to its middle-income customer base.

That helped to drive Matahari shares to an all-time high of Rp19,150 on May 16, two trading days before the block trade was executed. The stock closed at Rp18,800 on Wednesday.

On the back of strong opeartional results, the sellers were able to fully upsize the block trade by 40% to 175 million shares. Final pricing was settled at Rp17,250, implying a final discount of 8.2%.

According to a source familiar with the situation, the final order book was well covered from over 80 accounts including long-only and hedge funds and domestic institutions. Allocation was skewed towards existing shareholders as well as long-only funds.

The block sale of shares came as little surprise because CVC has been a frequent seller of Matahari since it sold part of its stake through a $1.3 billion follow-on offering in March 2013. The private equity firm bought a majority stake in the firm in April 2010 from Indonesian conglomerate Lippo Group and has since trimmed its stake in three open-market transactions.

The most recent transaction happened in January last year when CVC raised $293 million through the sale of an 8% stake in Matahari at Rp15,400 per share.

The private equity firm has cleaned up all its stake in Matahari following Wednesday's sale.

Block frenzy

Matahari’s follow-on offering is one of four equity transactions launched in Asian markets on Wednesday, which suggests bankers are betting on a recovery in market sentiment as Asian equities continue to stabilise.

Shortly after the Japanese stock market close, a senior executive of internet shopping website operator Start Today launched the sale of 5.9 million secondary shares to raise as much as ¥28.5 billion ($262 million).

The shares were offered at ¥4,675 to ¥4,855 per share and represented a discount range of 5.0% to 8.5% against the last close.

The seller, Yusaku Maezawa, is the company's chief executive and also the controlling shareholder, with a 43.1% stake before the sell-down.

Meanwhile, British lubricants manufacturer and distributor Castrol offered a 7% stake in its Indian unit for sale at Rs355 to Rs385.25 per share, potentially raising as much as $191 million. The sale in Castrol India featured an upsize option equivalent to half of the base offering.

Hong Kong-listed tissue paper manufacturer Vinda International was also in the market with a HK$404 million ($52 million) top-up placement. A total of 30 million shares were offered at HK$13 to HK$13.46 each, representing a discount range of 6.5% to 9.8%.

Bank of America Merrill Lynch was sole bookrunner for the transactions in Start Today and Vinda International, while Citigroup and ICICI Securities handled the Castrol India trade.

This article has been updated with pricing and allocation details.

¬ Haymarket Media Limited. All rights reserved.
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