MARKET DEVELOPMENT
Provident to Raise $83m From Secondary Offering
Provident to Raise $83m From Secondary Offering
24/10/2013 (Jakarta Globe) - Provident Agro, a palm oil plantation firm controlled by Saratoga Group, plans to raise Rp 929 billion ($82.7 million) in a secondary offering in December this year in an attempt to finance a plantation acquisition.
“The company will use at most Rp 141.4 billion from the proceeds to acquire a palm oil plantation through its subsidiary,” Provident Agro said in a brief prospectus published in Investor Daily newspaper on Wednesday.
Provident will use a further Rp 169.2 billion of the proceeds as working capital, and plans to set aside the remainder for paying some of its debt incurred with the acquisition of trading companies Nusaraya Permai and Alam Permai in May last year.
Shareholders with at least seven shares on Dec. 4 will have the right to buy three new shares, the company said. Provident is owned by Saratoga Sentra Business and Provident Capital Agro with 43.3 percent of the shares each. The remaining shares are publicly held.
Both Saratoga Sentra and Provident Capital have said they will exercise their right up to $6.25 million each, the palm oil producer said in the prospectus.
Provident is the holding company of 11 palm plantation firms in Sumatra and Kalimantan, with a total planted area of 44,788 hectares. The company also controls three palm oil factories. Provident conducted an initial public offering in October last year, raising Rp 297 billion.
During the first seven months of this year, the company posted a net loss of Rp 148 billion, citing a drop in crude palm oil prices and increasing costs for nurturing and harvesting palm trees. It reported a net loss of Rp 124 billion during the same period last year.
Provident sold crude palm oil between January and July for Rp 6,625 a kilogram on average, down 14 percent from the same period last year.
Still, the company is optimistic that CPO prices will increase in the future, banking on growing domestic demand for biodiesel and other palm oil derivatives products.
Saratoga Capital, part-owner of Provident, is controlled by Edwin Soeryadjaya and Sandiaga Uno. The Saratoga Group comprises a family of businesses including a private equity firm, airlines holdings, telecommunications, the automotive industry, and coal mining. One of Saratoga’s units, Adaro Energy, is the fifth-largest coal miner in Indonesia.
Shares of Provident Agro were unchanged at Rp 400 on the Indonesia Stock Exchange on Wednesday. Its shares have fallen 12.5 percent since listing on the IDX on Oct. 5 last year.
“The company will use at most Rp 141.4 billion from the proceeds to acquire a palm oil plantation through its subsidiary,” Provident Agro said in a brief prospectus published in Investor Daily newspaper on Wednesday.
Provident will use a further Rp 169.2 billion of the proceeds as working capital, and plans to set aside the remainder for paying some of its debt incurred with the acquisition of trading companies Nusaraya Permai and Alam Permai in May last year.
Shareholders with at least seven shares on Dec. 4 will have the right to buy three new shares, the company said. Provident is owned by Saratoga Sentra Business and Provident Capital Agro with 43.3 percent of the shares each. The remaining shares are publicly held.
Both Saratoga Sentra and Provident Capital have said they will exercise their right up to $6.25 million each, the palm oil producer said in the prospectus.
Provident is the holding company of 11 palm plantation firms in Sumatra and Kalimantan, with a total planted area of 44,788 hectares. The company also controls three palm oil factories. Provident conducted an initial public offering in October last year, raising Rp 297 billion.
During the first seven months of this year, the company posted a net loss of Rp 148 billion, citing a drop in crude palm oil prices and increasing costs for nurturing and harvesting palm trees. It reported a net loss of Rp 124 billion during the same period last year.
Provident sold crude palm oil between January and July for Rp 6,625 a kilogram on average, down 14 percent from the same period last year.
Still, the company is optimistic that CPO prices will increase in the future, banking on growing domestic demand for biodiesel and other palm oil derivatives products.
Saratoga Capital, part-owner of Provident, is controlled by Edwin Soeryadjaya and Sandiaga Uno. The Saratoga Group comprises a family of businesses including a private equity firm, airlines holdings, telecommunications, the automotive industry, and coal mining. One of Saratoga’s units, Adaro Energy, is the fifth-largest coal miner in Indonesia.
Shares of Provident Agro were unchanged at Rp 400 on the Indonesia Stock Exchange on Wednesday. Its shares have fallen 12.5 percent since listing on the IDX on Oct. 5 last year.