CT Set To Become Biggest Garuda Shareholder

April 25, 2012

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Emerging Indonesian business group CT looks set to become the biggest private shareholder in national flag carrier Garuda Indonesia after it became sole bidder for a 10.9 percent stake in the airline, sources close to the deal said.

The stake, currently owned by three state-brokerage firms, Mandiri, Bahana and Danareksa, is valued at least IDR1.5 trillion rupiah (USD$163.28 million), said sources with direct knowledge of the deal.

"The parties are negotiating the deal documentation but it is expected to be completed by the end of the week," said a source with direct knowledge of the deal who declined to be named as it remains private.

The deal could pave the way for CT to become the majority owner of the airline as the government said it will not be going to hold majority stake in Garuda.

"I don't think we (the government) need to hold a majority stake in transportation companies including Garuda," state enterprises minister Dahlan Iskan told reporters.

The CT group, which is led by the 49-year old entrepreneur Chairul Tanjung, has interests from banking to media.

The government owns a 69 percent stake in Garuda after it launched a disappointing USD$532 million initial public offering in February 2011 when the share price collapsed on debut due to its high valuation and political interference in its pricing.