Beverage producer PT Ultrajaya Milk Industry Trading Company Tbk (ULTJ) has sold 197 million shares at Rp 4,000 ($0.30) apiece in a private placement raising $60 million. The transaction was led by American broker Decker & Co and Indonesia’s SucorInvest.
Decker, in a statement on August 8, said the sale had attracted interest from foreign funds in Singapore, Hong Kong, USA and Europe. The placement was priced at a 2.4% discount to the market price per share.
“In addition to strong local participation in the deal, the placement was also subscribed to by a select group of global funds through Decker,” the broker’s statement added. The placement increased the free float to approximately 80%, supporting improved market liquidity in the stock. Ultrajaya’s founder, who remains actively involved in the business, has agreed to sell shares in the company to make the offering possible.
Founded in 1975, Ultrajaya is headquartered in Bandung and has a strong presence in the UHT Milk and RTD Tea categories.
Founder and CEO of Decker, Mark Decker said, private placements are once again a rising trend in ASEAN markets. The outflows and “sell” ratings seen last year are finally abating due to the strength of markets’ performance and limited opportunities elsewhere in the world.
“The Ultrajaya transaction demonstrates the continued interest by global funds in high-quality companies,” said Decker.
Ultrajaya aims to grow its net profit by 33.8 per cent this year to Rp 700 billion ($53.2 million) after posting Rp 523 billion in profits last year thanks to increased demand for its bottled tea Teh Kotak and milk brand Ultra Milk. Meanwhile, revenues are expected to increase 10 to 15 per cent to between Rp 4.83 trillion and Rp 5.05 trillion.
About 64.9 per cent of Ultrajaya’s revenues comes from its milk beverages, 25.3 per cent from tea and health drinks, while the remaining 9.7 percent is from other business lines.