Indonesian state-run lender Bank Mandiri is reportedly planning to acquire rival lender Bank Permata, which is backed by Standard Chartered.
According to a Bloomberg report, the lender is currently working with Morgan Stanley to advance the deal.
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Bank Permata acquisition:
Bank Mandiri is planning to acquire a controlling stake in Bank Permata and then merge it with itself or its unit PT Bank Mandiri Taspen, known as Bank Mantap, unnamed sources told the publication.
Permata currently market valuation is more than $2.2bn as its shares risen by 75% this year. The 11th largest bank in the country, Permata reported $64m in net income last year.
The move comes at a time when Standard Chartered, which is the joint-largest shareholder of Permata, reclassified the Indonesian bank as a non-core business.
It is expected to raise around $1bn by selling its 44.6% stake in Permata. PT Astra International also holds a 44.6% stake in Permata.
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By GlobalDataThe plan is part of its three-year strategy to increase return on equity to more than 10% by 2021.
Mandiri is yet to start formal discussions over the transaction. However, if the deal materialises, it will look to complete the Bank Permata acquisition by this year, Bloomberg report added.
The move was not confirmed by Mandiri and Standard Chartered officials or representatives.
