Putera Sampoerna Exits Palm Oil Business in $885 Million Deal

Strategic Divestment Decision

Putera Sampoerna, through Sampoerna Strategic Group, has divested its palm oil business by selling its 66% majority stake in PT Sampoerna Agro Tbk to PT AGPA Pte Ltd, a subsidiary of POSCO International Corporation. The transaction, valued at $885 million (approximately Rp 14.69 trillion), marks a significant exit from the palm oil industry.

Business Focus Shift

The divestment allows Sampoerna Strategic Group to concentrate on its existing businesses, which include banking, plywood manufacturing, and property development. The group is also open to exploring new business opportunities. This strategic move aligns with the company's efforts to optimize its portfolio and resource allocation.

POSCO's Strategic Expansion

POSCO International Corporation, the acquiring entity, is a South Korean company with existing operations in Indonesia, including steel and energy businesses. The acquisition of Sampoerna Agro is part of POSCO's strategy to expand its presence in the biofuel sector, which currently accounts for about 60% of global palm oil production. This move is expected to strengthen POSCO's position in the renewable energy market.

Financial and Market Implications

The sale of Sampoerna Agro's majority stake represents a significant financial transaction in Indonesia's corporate landscape. The deal not only reflects the strategic realignment of Sampoerna Strategic Group but also underscores the growing interest of international companies like POSCO in Indonesia's palm oil industry, particularly in the biofuel segment.