Temasek Releases Stake; Danamon Shares Rise 14 Percent

PT Bank Danamon Tbk (BDMN) share price closed up 14.17 percent at Rp 6,850 per share on Wednesday, December 27, 2017, from its closing price of Rp 6,000 on Friday, December 22. This surge was triggered by Temasek Holdings officially selling its 73.8 percent stake in Bank Danamon to Bank of Tokyo-Mitsubishi UFJ Limited (MUFG).

The transaction, which involved purchasing Danamon shares at a premium (significantly above the previous weekend's closing price), drove up the share price of the bank, which has a market capitalization of Rp 57.5 trillion. BDMN shares were sold at Rp 8,323 per share, or 38.72 percent above the previous weekend's closing price. This price is equivalent to twice Bank Danamon's book value in the third quarter of 2017. The acquisition is being carried out in three phases, expected to be completed between the second and third quarters of 2018.

Previously, BDMN share prices also rose 18 percent to Rp 5,725 per share on November 9, 2017, following news that Danamon would be acquired by the Japanese bank, MUFG. In the first nine months of 2017, the bank, with assets of Rp 173.68 trillion, recorded a 20 percent increase in profit to Rp 3.03 trillion, compared to Rp 2.52 trillion in the same period the previous year.