Indonesian firm Assegaf Hamzah & Partners (AHP) advised unicorn Bukalapak with its IPO on the Indonesia Stock Exchange (IDX) that raised IDR21.9 trillion (USD1.5 billion), the biggest IPO to date and the first e-commerce company to go public in the country.
The company offered 25.765 billion shares with an offering price of IDR850 per share. The shares were also offered to international investors under rule 144A/regulation S of the US Securities Act 1933.
The AHP team in Jakarta was led by partners Tunggul Purusa Utomo and Renaldi Zulkarnain, with the support of partner Farid Nasution, and senior associates Imanuel Rumondor and Derry Patradewa.
Utomo said that the value of the transaction posed a unique challenge, as Bukalapak wanted to fill demand from Indonesian investors without any disturbance. Certain adjustments had to be made, and the team had to co-ordinate with various regulators closely.
“The pandemic added another challenge to the deal in terms of co-ordination of multiple parties on the IPO preparation, as almost all stages of the process had to be done online,” Utomo told Asia Business Law Journal.
“Interestingly, one of the major impacts of covid-19 is the beginning of a consolidation in Indonesia’s fintech landscape. The pandemic has increased investor interest in pandemic-resistant sectors, which in Indonesia are e-commerce, logistics and fintech.”
Utomo said that the prospect for fintech in a country of 270 million people, where a third of the population is unbanked, is alluring. Half of the internet users already use mobile banking, and more than 80% of them are using e-commerce.
“Today, Indonesia’s fintech sector is one of the most dynamic and competitive globally, as evidenced by the emergence of four unicorn companies valued at over USD1 billion, and one decacorn valued at over USD10 billion,” he said. “Surrounding them is a fast-growing ecosystem that is helping to expand financial inclusion to the previously underserved segments of the country.”
Utomo also pointed out that the IDX is seeking to revise regulations regarding listing shares and equity securities other than shares issued by listed companies. Indonesia’s financial services authority is also preparing a draft regulation relating to, among other things, the implementation of public offerings with companies that implement multiple voting shares, or shares with multiple voting rights.
“Currently, this revision is in its final stage,” he said. “The amendments to the IDX rules will be embraced positively by the tech and startup companies planning to go public in Indonesia, as it will provide more flexibility and support for those companies to list, especially on the main board.”
UBS’ Singapore branch and Merrill Lynch (Singapore) acted as the joint global co-ordinators and international selling agents to market the shares to international investors, while local securities companies Mandiri Sekuritas and Buana Capital Sekuritas acted as joint lead managing underwriters.