Bank BTPN completes acquisition of 51% stakes in OTO and Summit Oto Finance

PT Bank BTPN Tbk, the Indonesian subsidiary of Japan's SMBC Group, completed its acquisition of controlling stakes in PT Oto Multiartha (OTO) and PT Summit Oto Finance (SOF), the vehicle-financing companies known collectively as OTO Group, on 27 March 2024.

Following the transaction, Bank BTPN holds 51% of both companies. PT Summit Auto Group, a subsidiary of Sumitomo Corporation, retains 34%, and PT Sinar Mas Multiartha Tbk holds the remaining 15%.

DEAL STRUCTURE

The transfer was first announced by Sumitomo Corporation on 11 December 2023. Under the plan, SMBC Group and the Sumitomo Corporation group transferred part of their combined shareholdings in the two finance companies to Bank BTPN, subject to regulatory approval, while Sinar Mas Multiartha remained an existing minority shareholder. On completion, Bank BTPN put the value of the transaction at Rp6.55 trillion, funded by its Rp6.73 trillion rights issue.

Sumitomo Corporation said the reorganisation was intended to strengthen the business base of both Bank BTPN and OTO Group, allowing them to capture growth in Indonesia's automotive financing market and respond to the shift towards electric vehicles and a decarbonised society.

EXPANDING VEHICLE FINANCING

OTO and SOF provide financing for two-wheel and four-wheel vehicles in Indonesia. According to the companies, the combination is intended to broaden the range of financing products on offer, improve penetration of underserved segments and make use of the combined branch networks across the country. Planned areas of collaboration include joint financing, expanding the ecosystem through network integration, and shared human resources training programmes.

Bank BTPN president director Henoch Munandar said bringing OTO Group into the bank's ecosystem could drive product and service innovation and add value for stakeholders. Victoria Rusna, president director of SOF and chief executive of OTO Group, described the completion as an important achievement for the group, saying the collaboration could extend financing services to remote areas that previously lacked access.