Sampoerna launches rights issue to boost float

Philip Morris is obliged to offload part of its stake in its Indonesian unit before the nation's new free-float requirements come into effect in early 2016.

American tobacco giant Philip Morris International echoed the Indonesia Stock Exchange’s call for bigger free floats on Monday by launching a share sale worth up to Rp20.3 trillion $1.4 billion in local unit PT Hanjaya Mandala Sampoerna.

Sampoerna is Indonesia’s largest public company with a market capitalisation of Rs326 trillion. Yet, intriguingly, it is not a constituent of the Jakarta Composite Index as its free float has been below 2% since Philip Morris took over the company in a $5.2 billion deal in 2005.

Due to the low number of shares in circulation Sampoerna, Indonesia's largest cigarette manufacturer, has operated almost like a private...

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