Carlyle completes first Southeast Asia deal

According to Reuters, the target is publicly-listed STP, which has a market capitalization of about IDR3.45 trillion ($360 million) and is trading at a price-to-earnings (P/E) ratio of more than 18x. Bloomberg says the company recorded a net profit of IDR134.3 billion in 2011 against revenues of IDR330.9 billion.

STP was established in 2006 and is Indonesia's fourth-largest tower operator, with approximately 650 towers in Jakarta and 500 more in Greater Jakarta and other parts of the country as of year-end 2010.

Carlyle, which is in the process of raising its fourth regional buyout fund with a target of $3.5 billion, has struggled to source deals in Southeast Asia, particularly Indonesia. The private equity firm currently has four investment professionals based out of Singapore - supported by staff based in other offices in Asia - and lost Anand Balasubrahmanyan, a senior managing director, earlier this year.

Industry sources identify at least three Indonesia deals that Carlyle targeted but failed to land. These include mining services contractor Buma Resources and cable TV operator LinkNet, which ultimately went to Northstar Pacific Partners and CVC Asia Pacific, respectively.

Last summer Carlyle seemed poised to land a 25% stake in GarudaFood, having made a bid of around 20x EBITDA, but the deal floundered and the food and beverage producer ended up agreeing a joint venture with Japan's Suntory instead.

As Southeast Asia's largest market and boasting favorable demographics and rising domestic consumption, Indonesia is one of the reasons global buyout firms are scaling up their presence in Singapore as a regional hub. This week KKR's opened its seventh Asia office in the city state.

However, large-cap deals are difficult to come by and the track record of large funds is mixed. While TPG Capital and CVC Capital Partners have managed to execute significant transactions, the former through an alliance with local GP Northstar Pacific Partners, others have found it more difficult. Earlier this month Affinity Equity Partners completed its first Indonesia deal, three years after opening an office in Jakarta.

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• Topics
• Southeast Asia
• Buyout
• Infrastructure
• PIPEs
• The Carlyle Group
• PIPE
• Indonesia
• Southeast Asia