Northstar, GIC in $200m Indonesian oil deal

According to the Financial Times, Northstar and GIC have acquired a minority stake through a combination of equity and convertible bonds, and they have the right to inject a further $50 million into the company.

There was no formal auction for the asset, but a number of other private equity firms, including KKR, also submitted bids. The company is owned by Theodore Rachmat, former CEO of carmaker Astra International, and Benny Subianto, who formerly ran Astra's plantation arm.

Prior to setting up Triputra Agro Persada, the two men played a leading role in the development of Adaro Energy, a coal producer that was backed by another Indonesian GP, Saratoga Capital. The company expanded to become the country's Indonesia's second-largest coal producer and listed and raised $1.3 billion through an IPO in Jakarta in 2008.

A number of domestic GPs saw strong returns on investments in mining companies made in their early days, typically taking significant minority stakes. Northstar and Ancora's $647 million purchase of a 45% interest in Bumi Resources in 2008 stands out as one of the largest transactions in the space.

Shortly after Northstar raised its $820 million third fund last year, a source familiar with the GP told AVCJ that commodities would likely feature less prominently than in previous vehicles. The thinking was that many assets, notably in the mining sector, are already well developed and command high valuations.

Triputra Agro Persada is, by comparison, a young operation, with 130,000 hectares of planted plantations in Kalimantan and Java, and a land bank of more than twice that size. Rachmat is also the father-in-law of Patrick Waluja, Northstar's co-founder.

Northstar, GIC and TPG Capital are frequent co-investors, the Singapore sovereign wealth fund also serving as a Northstar LP, while TPG and the Indonesian GP own stakes in one another. Their best known collaboration was the acquisition of Buma, Indonesia's second-largest mining contractor in 2010.

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• Topics
• Industrials
• Southeast Asia
• Expansion
• Northstar Group
• GIC Private
• Co-investment
• Commodities
• energy
• Indonesia