PT Semen Indonesia Persero Tbk : Rights Issue SIG 2022_v2
December 07, 2022
Share
Seizing Turnaround Momentum
8 December 2022
SEIZING TURNAROUND
MOMENTUM
SMGR Capital increase through Pre-emptive rights
2
Semen Baturaja
3
ESG Initiative
6
Building Materials Expansion Program
7
Transaction Update
8
SMGR CAPITAL INCREASE THROUGH PRE-EMPTIVE RIGHTS
SIG will leverage Rights Issue to grow value and return to shareholders through SMBR integration, ESG initiatives, and potential expansion in basic material business
Rights Issue Information
Total
Proceed of Additional capital up to 5.6 IDR Tn*
Share
Issuance
Net proceeds from the Rights Issue will be used to expand
Objective company's position in the cement market, ESG initiatives & basic material business
Shareholder type
A
Government
of Indonesia
Participation & Use of Proceed
• Will exercise its rights through share swap
with its ownership on SMBR
•
SIG will receive 75.51% of SMBR
ownership
•
Will participate in cash
75.51%
SIG ownership in PT. Semen Baturaja Tbk (SMBR) post share swap
2.85 IDR Tn
SMBR valuation
based on fair value by independent appraiser & approved by Ministry of Finance through Finance Minister Decree
B
Public
shareholder
• SIG will receive gross proceeds from the
public of up to 2.7 IDR Tn & use the
proceeds to expand further with potential
acquisition in ESG initiatives & basic
material business
Supporting 1.68 IDR Tn CAPEX investment for ESG initiatives:
Thermal Substitution Ratio
Clinker Ratio
Potential expansion in integrated basic building material that has:
High EBITDA margin
Significant growth opportunity
High potential synergies
* Based on 100% participation and subscription
2
SEMEN BATURAJA
Cement sub cluster SOE integration will support SIG in domestic market dominance
Overview of SMBR (2021)
53%
market share
Legend:
x%
Market share by
province
Manufacturing
facilities
Integration Structure: SMBR Shares Transfer to SIG
Share Swap Process
Current Structure
South Sumatera market
11%
leader with
"Semen Baturaja" brand
Jambi
1%
4.55 Mn Tons
Bangka
13%
Belitung
Cement Capacity
53%
3
Bengkulu
PublicPublic
48,99%
51,01%
24,49%
75,51%
+1 series A
Dwiwarna share
"government participation in the SIG rights issue transaction is carried out on a non-cash basis through the transfer of all state-owned Series B shares in SMBR.."
2.7 Mn Tons
South
Sumatra
Clinker Capacity
1
2
29%
Final Structure
Public
≤ 48,99%
≥ 51,01%
Plant
Plant Type
4
Baturaja Plant
Integrated Plant; Clinker Manufacturing,
Lampung
1
2
Cement Grinding & Packing
3 Palembang Plant Cement Grinding and Packing
Other SIG
subsidiaries
75,51%
+1 series A Dwiwarna share
4 Panjang Plant
Cement Grinding and Packing
3
SEMEN BATURAJA
Potential value creation from SMGR and SMBR integration
Operational Metrics
Increase Average Selling Price (ASP) Net
Sales & Marketing
Distribution Network Optimization
(Cross-Selling)
Supply Chain
Utilization optimization
Management
Reduce CTS/Ton
Decrease PCC Clinker Factor
Production
Increase TSR
Best practice sharing
Procurement
Best tariff & economies of scale
Others
Refinancing Potential
Assumption
Change SMBR pricing strategy to align with SIG (main brand increase 2.2%, fighting brand increase 1.9%, every year)
Utilize distribution network and potential cross selling
PoS expansion to increase market penetration
Supply market from facilities with the lowest cost-to-serve to reach higher utilization
Shift production to be closer to customers to optimize distribution
Decreasing SMBR PCC clinker factor from >70% to be at SIG level (~65%)
Increase SMBR TSR usage from ~0.7% to reach SIG level of ~5%
Higher purified gypsum composition (from ~70% to ~90%)
Using lower calorific coal
Installing plant optimizer
Utilizing best tariff across all plants
Better bargaining power from consolidated demand
Potential decrease in SMBR interest rate (∆ of ~3%)
1-year
5-year
Impact
Impact
(IDR Bn)
(IDR Bn)
21
64
32
256
113
789
13
94
6
21
105
345
23
87
34
113
347
1,769
>1.7
IDR Tn
potential value
creation in 5
years
4
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Disclaimer
PT Semen Indonesia Persero Tbk published this content on 08 December 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 15 December 2022 10:15:02 UTC.
PT Semen Indonesia (Persero) Tbk is an Indonesia-based multinational building materials solutions company. The Company provides a range of product and service variants according to the level of development needs from simple renovations, property development projects, public facilities, infrastructure to other large-scale projects. The Company has two segments: cement production and non-cement production. Cement production segment produces and markets cement products in Indonesia, Vietnam, as well as various export destination countries. In addition to production facilities, the Company has also developed various supporting facilities, such as packaging factories, ports, and other distribution support networks spread across all provinces in Indonesia and parts of Vietnam. Non-cement production segment consists of mining limestone and clay, manufacturing packaging bags, developing industrial estates, finished and ready-to-use concrete, information system services, logistics and trading.