Indonesian power company PT Cikarang Listrindo Tbk set the initial public offering (IPO) at Rp1,500 per share after marketing its 2.5 billion shares – raising Rp3.75 trillion ($275.74 million), said sources close to the deal.
Previously the company had offered the shares with a price range of Rp1,430 – Rp1,970 each.
The final price of the shares equals 7.3 times EV/EBITDA (enterprises value divided by earnings before interest, tax, depreciation and amortization) for the financial year or price to earning at 12 times of 2017 earnings.
Cikarang Listrindo’s IPO has been oversubscribed predominantly by the foreign investors including the anchor investor Matthews International Capital Management, which has come in for $50 million worth of shares.
The international roadshow was launched in Hong Kong and wrapped up by May 26. Indonesian retail investors will have a chance to place orders between June 7-8, a week before the stock goes live on the Indonesian Stock Exchange (IDX) on June 15.
After the listing, stake of Cikarang’s existing shareholders will be diluted. PT Udinda Wahanatama‘s share will be reduced from 39.92 per cent to 36.38 per cent, while PT Pentakencana Pakarperdana and Brasali Group each will hold a reduced stake of 27.04 per cent instead of the 31.81 per cent
The shareholders plan to then divest another 15 per cent of stakes in Cikarang through a private placement. Udinda will end up with 25.46 per cent, while Brasali and Pentakencana will each hold 22.27 per cent.
The West-Java based firm is planning to use the IPO proceeds to expand its generation capacity and other general corporate purposes. Last year, Cikarang Listrindo and US’s General Electric inked a $600-million deal for power plant developments.
In order to cope with increasing electricity demand, Cikarang is building a new 280 megawatt coal-fired power plant that is expected to complete by the end of this year. Completion of the new plant will boost the company’s total installed capacity by 32 per cent to 1,145 megawatts.