Four Global Retailers Interested in PT Matahari

JAKARTA, KOMPAS.com - Four global retailers, including South Korea's Lotte Shopping Co. (023530.SE), have expressed interest in buying a majority stake in the hypermart business of Indonesian retailer PT Matahari Putra Prima (MPPA.JK), Matahari said late Thursday, citing its adviser, Bank of America Merrill Lynch.

Matahari said its adviser will continue to talk with the global retailers but didn't name the three other retailers.   source familiar with the planned stake sale last month told Dow Jones Newswires that Matahari had shortlisted Lotte Shopping, Wal-Mart Stores Inc. (WMT)  and France's Casino Guichard-Perrachon SA (CO.FR) for the purchase of its hypermarket operations.

Lotte Shopping had  said Tuesday that it will join the final bid to acquire Matahari's hypermarket operations to boost its presence overseas. Analysts said foreign retailers are seeking to enter the Indonesian retail market due to the country's positive economic prospects.

“The fight (for) retail space in Indonesia is definitely heating up,“ BNP Paribas analyst Elvira Tjandrawinata said.

Tjandrawinana said she expects mergers and acquisitions to continue to be a strong theme next year, with foreigners likely to come in via acquisitions rather than having to start from scratch.

“This is more apparent currently in the retail sector as securing strategic locations and a license could be easier done via acquisitions,“ she said.

Matahari, which operates 51 hypermarkets across Indonesia, said in October that it was reviewing its overall business operations in conjunction with its plans to aggressively expand its core competence in the hypermarket business.

The move came after it sold its entire 90.76% stake in unit PT Matahari Department Store (LPPF.JK) for IDR7.2 trillion to Meadow Asia Co. earlier this year in the largest private-equity deal in the country.

Besides hypermarkets, it also operates supermarkets, pharmacy outlets, entertainment centers and bookstores.  Separately, the company said Friday that it will pay an interim dividend of IDR179.2 a share on Dec. 27.