| Wed 17 Jun 2009, 8:00 | | BTI - British American Tobacco acquires control of Indonesia`s Bentoel |
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BTI
BTI
BTI - British American Tobacco acquires control of Indonesia`s Bentoel
British American Tobacco p.l.c.
Incorporated in England and Wales
(Registration number: 03407696)
Short name: BATS
Share code: BTI
ISIN number: GB0002875804
("British American Tobacco p.l.c." or "the Company")
British American Tobacco acquires control of
Indonesia`s Bentoel
British American Tobacco today acquired from Rajawali Group and other
shareholders an 85 per cent stake in Indonesia`s fourth largest cigarette maker
PT Bentoel Internasional Investama Tbk for US$494 million (GBP303 million).
The price is equivalent to IDR873 per share, a premium of 20 per cent over
Bentoel`s closing price of IDR730 per share on 15 June 2009. A public tender
offer for the remaining shares will be announced in due course and is expected
to be completed by the end of August 2009.
Assuming that all the shares are tendered, the overall transaction would value
100 per cent of Bentoel at approximately US$580 million (GBP356 million).
John Daly, British American Tobacco`s Asia-Pacific Director, said: "This
transaction represents an excellent strategic opportunity to enter the very
large and growing Indonesian kretek market and will provide a platform for
future growth."
Indonesia is the world`s fifth largest tobacco market by volume, with sales of
around 250 billion cigarettes a year, and a global top ten market by profit.
The kretek segment accounts for some 93 per cent of the market. Kreteks are
cigarettes made from tobacco and cloves and are produced by machine or hand
rolled. Bentoel`s key kretek brands include Star Mild, X Mild and Sejati.
In 2008 Bentoel sold 17.7 billion cigarettes, representing approximately seven
per cent of the market.
Bentoel`s earnings before interest, tax, depreciation and amortisation for the
12 months to 31 March 2009 were US$53 million (GBP32 million). It had net debt
of US$164 million (GBP101 million) at 31 March 2009.
British American Tobacco`s existing business, PT BAT Indonesia Tbk, has an
approximate two per cent market share and competes only in the white cigarettes
market.
NOTES
Exchange rates: US$1.63 = GBP1.00 = IDR 16,499
The transaction represents an EV/EBITDA multiple of 12.9x after adjusting for
normal working capital levels.
Rajawali Group held a 56 per cent shareholding in Bentoel.
British American Tobacco is the world`s second largest quoted tobacco group by
global market share with brands sold in more than 180 markets. In 2008 its
subsidiary companies sold 715 billion cigarettes made in 49 factories in 41
countries and employed more than 50,000 people.
British American Tobacco is being advised by Deutsche Bank and UBS.
17 June 2009
Sponsor: UBS South Africa (Pty) Ltd
Date: 17/06/2009 08:00:04 Produced by the JSE SENS Department.
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