Global investment firm KKR is set to buy 10.4% stake in Indonesia-based agri-food company Japfa for $81.2m.
As part of the deal, Japfa will place 750 million new shares to KKR via a private placement at about $52.9m.
Concurrent with the private placement, Japfa group will sell 441.7 million shares in PT Japfa to KKR for an estimated sum of $28.3m.
The group plans to strengthen its balance sheet from the private placement and share sale transactions, which are a part of its overall strategy to infuse fresh equity funding.
Japfa chief executive officer Tan Yong said: "We believe PT Japfa Tbk will benefit from KKR's deep knowledge and experience in the agriculture and food sector, and its long-term investment thesis of promoting and enhancing the availability of safe and healthy food. We look forward to deepening our partnership with KKR in the future."
Over the past three years, KKR has been investing and offering financial solutions to companies in Indonesia.
Japfa will see a capital gain of nearly $21.2m from the sale of its shares in Japfa.
However, the transactions are subject to the approval of the issue of new shares by PT Japfa's shareholders.
KKR Asia private equity co-head said: "We see a great opportunity for Indonesia's poultry market given the country's rising middle class, favorable urbanization trends and increasing protein consumption.
"Japfa is the right partner with which to capture these opportunities given its leading market position, experienced management team and strong focus on food safety."
Japfa is a major agri-food producer focused on emerging Asian markets and it produces protein staples such as chicken, beef and milk, as well as protein-based consumer food products.
Headquartered in Singapore, operates its businesses in the fast growing economies of Indonesia, China, India and Indo-China.
