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MARKET: Michelin acquires 80% Multistrada shares for US$439M

Heavy duty tire (image credit: Michelin)

JAKARTA (RambuEnergy.com) – Tire producer Michelin Group said it has acquired 80% shares of Indonesia’s tire producer PT Multistrada Arah Sarana Tbk (IDX:MASA) or 7.346 billion units of shares for US$439 million.

In a statement, Michelin said it will launch a tender offer to other Micheline shares being held by the public as required by the capital market regulation.

The shares were purchased from key shareholders including shares of PT Central Sole Agency owned by Pieter Tanuri.

Multistrada said that the buyer and the sellers have signed an agreement for the sale and purchase of an interest in PT Multistrada Arah Sarana Tbk on Jan. 22, 2019.

The company was valued at USD700 million, representing 6.3 times of the company’s EBITDA per September 2018.

The valuation includes Multistrada’s 20% interest in retail company Penta and 50-hectares of land.

Michelin is a French company with an address of 23 Place des Carmes Dechaux, Fr-63040 Clermont-Ferrand Cedex 9, France. The company has no relation (non-affiliate) with the seller.

Multistrada has a capacity to produce 11 million units of car tires, 9 million of motorcycle tires and 250,000 units of truck tires per year. In 2017, the company posted sales of US$281 million.

The acquisition allows Michelin to strengthen its grip in the South East Asian market and Indonesia in particular.

In addition, through this transaction, Michelin will acquire 20% of PT Penta Artha Impressi (Penta) shares, a car distributor.

CEO of Michelin Jean-Dominique Senard said the acquisition of Multistrada shares enables Micheline to widen its operation and market in Indonesia.

Multistrada shares were traded shares on Wednesday morning (Jan. 23). At 09.04, Multistrada shares were traded at Rp 780,00 per share, up Rp15.00 from yesterday’s close (+1,96%).

Multistrada is one of the largest tire producers in Indonesia. It operates tire plant on 55 hectares and 128 hectares in East Cikarang, West Java, Indonesia. (*)

Written by Roffie Kurniawan (Email: roffie.kurniawan@gmail.com)

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