Jakarta. A report from Bain & Company names Singapore as leader by value in mergers and acquisitions in Southeast Asia in 2014, while Indonesia’s election uncertainty is blamed for the country last-place finish.

“Asia Pacific Private Equity Report 2015,” published last month, shows Singapore as having led the private equity deals in the bloc, producing two mega deals totalling $2.3 billion last year, helping push overall investment value in Southeast Asian market to $5.9 billion.

This result is slightly better than 2013, but still 7 percent below the five-year average.

“For the last several years, private equity investors looking to diversify their exposure to the much larger markets of China and India have piled into Southeast Asia, hoping that the fast-growing sub-region would catch fire,” the report said.

“For a variety of reasons — heavy competition, too few targets, macroeconomic and political issues — they are still waiting.”

The Boston-based consultancy firm said Indonesia placed as the largest disappointment among the Southeast Asian community, where investment value slid for a fourth consecutive year to $298 million.

Bain said “investors fretted over high prices and waited for the outcome of midyear elections.”

“In the wake of the Indonesian elections, the new regime is sending positive signals to the business community, and macro trends more broadly are favorable,” Bain said.

Meanwhile, smaller markets such as the Philippines and Thailand contributed to the robust growth in merger and acquisition deals in the region last year, despite rich valuations in the Philippines and a military coup in Thailand.

As for exits, the consulting company said “investors, or general partners, throughout the region worked hard to produce transactions, but they were often not comfortable with the price they could get, causing delays.”

Investors closed as many exit transactions last year as the previous year, but almost half were valued at less than $50 million, and total value slid to $4.4 billion — the worst showing since 200, the consulting firm said.

“Despite all this, investors still view Southeast Asia as an Asia Pacific gem. General partners, or investors, expect the sub-region to top China as the most attractive market for new deals in 2015,” the report said.

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Jakarta. National flag carrier Garuda Indonesia has joined hands with state lender Bank Negara Indonesia, in staging Garuda Indonesia Travel Fair 2015.

The two-day travel fair, which ran from Friday through Sunday, was expected to attract at least 120,000 visitors and rack up sales of up to Rp 245 billion ($18.9 million).

“GATF is a one-stop shopping fair [for travellers]. In addition to selling flight tickets, it also offered other holiday-related services, including accommodation and tour packages,” Garuda commercial director Handayani said in a press release on Friday.

The travel fair was held simultaneously in nine cities, namely Jakarta; Bandung, West Java; Yogyakarta; Solo, Central Java; Makassar, South Sulawesi; Surabaya, East Java; Pontianak, West Kalimantan; Semarang, Central Java; and Balikpapan in East Kalimantan.

GATF is scheduled to arrive at eight more cities in April 10-12, including Denpasar, Bali; Medan, North Sumatra; and Jayapura, Papua.

Garuda hopes the fair will help boost domestic tourism, Handayani said.

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Jakarta. Medco Energi International, the country’s largest listed oil and gas company, reported a near 20 percent decline in profits last year on the back of falling sales.

According to Medco’s filing to the Indonesia Stock Exchange on Monday, the company recorded a profit $10.11 million last year, down from $12.58 million in 2013.

Medco’s total sales and other operating revenues declined by 15.32 percent to $750.73 million from $886.52 million.

The sales from oil and gas declined 15.2 percent to $701.43 million from $ 826.84 million in 2013, which contributed 93.4 percent to the total sales.

Oil and gas companies have been coping with falling global crude oil prices, which have impacted demand across the industry.

In a separate statement, the company said it’s oil and gas production declined to 56,000 barrels of oil equivalent per day (boepd) last year from 62,000 boepd in 2013.

Medco’s average crude oil price also fell 9.6 percent to $97.83 per barrel last year.

“The company’s decline in oil production [in 2014] was also caused by the company’s decision to return Sembakung block to Pertamina in December 2013,” Medco said in a separate statement.

Medco Energi returned the North Kalimantan block to state-energy company Pertamina after its 20-year technical-assistance contract.

On Tuesday, Medco also reported that its total cost of sales and other direct costs fell to $479.77 million, or down 8.04 percent, from $521.73 million the previous year.

Medco’s oil and gas production, lifting and exploration costs contributed 64 percent of overall costs.

Lukman Mahfoedz, president director of Medco Energi, said the company would keep processes and operation costs efficient, including evaluating explorations and projects which are yet to reach the final investment decision.

“In the future, Medco Energi will keep conducting the investment that will add oil and gas production, as well as the company’s sustainable growth,” he said in the statement.

The company, through its subsidiary Medco Power Indonesia, last year secured $1.2 billion in funding for the Sarulla geothermal project in North Sumatra from the Japan Bank for International Corporation, the Asian Development Bank and several commercial banks.

Medco is controlled by the Panigoro family and it operates nine oil and gas blocks in Indonesia.

The company also operates a number of overseas blocks, including in Libya, Oman, Papua New Guinea, Tunisia, Yemen and in the Gulf of Mexico off the US coast.

Medco Energi’s stock price declined by 0.48 percent to Rp 3,100 per share on the Indonesia Stock Exchange on Tuesday.

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Jakarta. Global debt ratings agency Fitch Ratings expects Indonesia’s economy to grow by 5.5 percent in 2015 and by 6 percent in 2016.

The $850 billion economy should benefit from the fuel subsidy cut, an improved investment climate and narrowing current account deficit, Fitch wrote in a report on Monday.

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Jakarta. Mayapada Group, through Sejahteraraya Anugrahjaya, the holding company of Mayapada Hospital, plans to raise $77 million from a secondary rights offering in the second half in order to build five hospitals in five cities this year.

Tahir, the chief executive of Mayapada Group, said in an interview last week that the company intends to expand its business to Surabaya in East Java, Bandung in West Java, East Kalimantan’s Balikpapan, Banjarmasin in South Kalimantan and Lebak Bulus in South Jakarta.

“I don’t intend to build small hospitals, but the big, complex one like Stanford Hospital,” Tahir said, referring to the Stanford University’s high-ranking hospital in California.

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Jakarta. Matahari Putra Prima, the operator of Hypermart, Foodmart and the Boston Health & Beauty retail chain, opened a Foodmart supermarket in Madiun, East Java, on Monday, as part of the company’s expansion to the fast growing city.

The store is located at Suncity Mall in Madiun city center and will occupy a gross area of 1,500 square meters. It is the company’s third Foodmart store in the country’s second most populous province.

“Madiun has remarkable economic growth, especially in the trade and services sectors,” said Danny Kojongian, MPP’s director of public relations and communications, in a statement.

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Jakarta. The Organization for Economic Cooperation and Development says it is bullish about Indonesia’s prospects for economic growth, but adds that much work remains if the nation hopes to leverage its demographic bonus and lift its status from a lower-middle-income country into upper-middle-income range.

The OECD is an intergovernmental organization comprised of 34 mostly European member states with developed economies. Its mission is to promote democracy and open markets.

On Wednesday, the OECD unveiled its annual “Economic Survey on Indonesia,” which prefaced its criticism by observing: “Today Indonesia is outperforming most of its regional neighbors, and most other emerging market economies.”

“But,” OECD secretary general Jose Angel Gurria Trevino said in a press release on Wednesday, “by accelerating reforms it can do even better, grow even faster, and ensure that all Indonesians share the benefits of growth.”

Gurria was in Jakarta to officially open the OECD’s new Southeast Asia office, which will serve as a platform for boosting the OECD’s work in the region and enabling the organization to cooperate more closely with counterparts in Indonesia, as well as Southeast Asian nations.

The OECD report concurred with local analysts’ findings that Indonesia’s policy reforms that slashed fuel subsidies last November had successfully opened fiscal room for more spending in productive sectors such as infrastructure, education and the social security system.

In a separate statement on Wednesday, the OECD said it forecast Indonesia’s economic growth to reach 5.3 percent in 2015 and 5.9 percent in 2016, a faster pace than last year’s slow growth. Indonesia’s economy expanded 5 percent in 2014, a fourth consecutive year of slowing.

The OECD is one of several international organizations projecting economic growth to accelerate this year and next.

The Asian Development Bank released a report on Tuesday that estimated Indonesia’s economy could grow by 5.5 percent and 6 percent in 2015 and 2016, respectively.

Echoing the oft-repeated refrain of the United Nations Population Fund, the OECD emphasized that Indonesia’s demography now offered a limited window to catapult the country’s development forward.

“With 43 percent of its 250 million-strong population under the age of 25, the country is already endowed with the human resources necessary to propel growth, provided its workforce is equipped with the right skills.”

To-do list

To reap the demographic dividend or “bonus” between now and 2030, during which time more of the population will be of working, productive age than dependent, Indonesia must improve the quality of education by reforming teacher training, professional development and increased accountability, Gurria said.

However, should there not be enough jobs for productive-age people, the prospective “bonus” could instead backfire.

The OECD urged Indonesia to do more to make the most of its natural resources, notably by increasing agricultural productivity through technical assistance and training, while improving farmers’ access to credit.

The OECD also urged its new host to diversify energy sources away from fossil fuels, notably by promoting investment in its abundant geothermal resources. Also included in the Jakarta office’s opening salvo was a call to avoid protectionist measures that inhibit openness to trade and foreign investment.

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Manpower Minister Muhammad Hanif Dhakiri vaults a wall during a raid — with full media contingent in tow — on a house run by a company suspected of illegally sending Indonesian migrant workers abroad, in Tebet, South Jakarta, on Nov. 5, 2014. (Photo courtesy of Manpower Ministry)

Manpower Minister Hanif Dhakiri said the government will raise requirements on foreigners working in Indonesia in order ensure more jobs available to local workers.

The Manpower Ministry is preparing a regulation that will, among other things, limit the type of jobs available to foreign workers and require potential workers to speak Bahasa Indonesia, Hanif said on Saturday.

Hanif noted there were many foreign workers who enter Indonesia without proper permits.

The minister, however, did not address concerns over closing the skill gap between local and foreign workers.

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Bank Rakyat Indonesia’s automated teller machine. (JG Photo/Afriadi Hikmal)

Bank Rakyat Indonesia Pension Fund, a unit of the country’s biggest micro lender, seeks to manage $364 million in assets this year, up 30 percent from 2014, tapping into BRI’s strong network in Indonesia.

According to a statement on Monday, the pension fund aims to have 122,000 individual customers and 151 corporate customers this year, up from the 112,000 individual customers and 111 corporate customers serviced last year, said Budi Satria, BRI’s corporate secretary.

BRI Pension Funds place 55 percent of its total funds in to money market instruments, such as time deposits, and 43 percent in to government and corporate bonds with the remaining funds invested in mutual funds and stocks.

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Jakarta. First Media, a cable and television provider affiliated with the Lippo Group, launched its 4G mobile Internet service in Medan, North Sumatra, last week in collaboration with sister company Internux, tapping into a potential market of five million people.

Internux is the first Indonesian Internet access provider using 4G long-term evolution technology under the Bolt! 4G LTE brand. The company has been acquiring around 6,000 users per day since it launched the service in the city on Wednesday, a director said over the weekend.

“Bolt! Super 4G LTE is a strong brand and has been known to have successfully introduced the 4G service in the Great Jakarta area,” First Media vice president director Irwan Djaja said in Medan last week.

Bolt! has attracted more than a million users in the Great Jakarta area since it was launched a year ago.

“With Bolt! we will continue to expand our network and penetrate the market of around five million in Medan and the surrounding areas,” Irwan said.

Irwan said he hoped the Bolt! Super 4G LTE could also function as infrastructure that can improve the lives of the people and take Indonesia forward so it can compete with more advanced nations.

The 4G technology offers much faster download speeds compared to current 3G technology offered by mobile operators. Larry Ridwan, chief commercial officer of Bolt! Super 4G LTE, said Medan was the first city in Sumatra to enjoy the service.

“Until the end of Friday, we have signed up around 12,000 new users,” Larry said over the weekend.

Data from Nielsen, a global information and measurement company, showed there were 719,001 Internet users in Medan last year. It sees a potential of 1.5 million users in Medan and surrounding areas.

“With the 4G technology, we want to take the people of Medan to enjoy better Internet access, which allows users to make video calls and video streaming without interference and buffering, to download large files in a short period, and to browse websites easily and faster where ever and whenever,” Larry said.

Internux aims to attract three million subscribers by 2015. The company plans to spend $18 million this year to build 600 more base transceiver stations in its bid to strengthen its network capacity to reach more customers and launch its own voice services.

GlobeAsia is affiliated with the Lippo Group.

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