CIMB considers privatising Indonesian unit as secondary offering appeal fades
Public Investment Bank estimates that buying out CIMB Niaga’s minority shareholders could cost RM800 million, with deliberations still preliminary.
CIMB Group Holdings Bhd is considering privatising CIMB Niaga as difficult market conditions make a potential secondary offering less attractive, according to analysts briefed by the bank. A share placement to strategic investors is another option under consideration.
The options were discussed at a briefing before the closed period, led by chief financial officer Khairul Rifaie. In its subsequent note, CIMB Securities, the group’s research arm, assessed privatisation as the more credible and strategic choice among the three alternatives.
Revised minimum free float rules require CIMB’s 91.4% holding in Niaga to fall to at least 87.5% by March 2027. The requirement then moves to 85% by March 2028, as part of efforts to improve Indonesian stocks’ investability.
Indonesian equities have suffered a broad sell-off amid a possible MSCI downgrade to ‘stand-alone market’ status, weakening the appeal of fresh share issuance.
Public Investment Bank said in a separate note that discussions remained preliminary and regulatory obstacles still needed to be addressed. It estimated that a full purchase of minority shareholders’ stakes could cost RM800 million.
