VALUATION OF PT ILTHABI ENERGIA TENAGAHIDRO TO SUPPORT THE ACQUISITION STRATEGY BY PT BINA PERTIWI

• Main Author: PRAJOGO NIM 13413042, DIGA
• Format: Final Project
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/26651
• Institution: Institut Teknologi Bandung

Electricity in Indonesia always be the most needed things for human beings. At this time, most of sources of electrical energy in Indonesia still using primary energy derived from fossil fuels that are non renewable energy. Non renewable energy potentially cause problem because of the population growth rate in Indonesia itself that keep increasingly throughout the day, and renewable energy could become a solution of these problems. Government also issued a regulation that encourages the development of renewable energy industry. <br /> <br /> PT Bina Pertiwi see that opportunity then decided to build minihydro power plant (PLTM) on the River Mangku-Sosial, Bener Meriah, Aceh owned by PT Ilthabi Energia Tenagahidro. Mangku-Sosial minihydro power plant have the potential power equal to 7.2 MW and 30 years investment period. <br /> <br /> Acquisition of 80% PT Ilthabi Energia Tenagahidro stakes, require estimate funds equal to Rp21.000.000.000 with the requirement that PT Bina Pertiwi should fund all the needs of development process, including the cost of building PLTM equal to Rp182.000.000.000. <br /> <br /> PT Bina Pertiwi have to make a good acquisition planning, so that the process of acquiring give an advantage for the company. Thus, a financial feasibility study and company valuation study needs to be done so it can be known whether this minihydro power plant development and company acquisition will benefit financially or not. <br /> <br /> Financial feasibility studies carried out by calculating the performance indicators of investment, i.e the Net Present Value (NPV), Internal Rate of Return (IRR), and Payback Period (PBP), used Weighted Average Cost of Capital equal to 13,4%. The amount of NPV is Rp32.459.221.460, IRR equal to 13,26% and PBP about 12 Years and 8 Months. <br /> <br /> The methodology used in company valuation of PT Ilthabi Energia Tenagahidro is Free Cash Flow to Equity (FCFE), Free Cash Flow to Firm (FCFF), Residual Income (RI), Dividend Discounted Method (DDM), and Market Value Based (MVB). As the calculation result, shows that company value issued by PT Ilthabi Energia Tenagahidro Rp21.000.000.000 for 80% stakes of the company and Rp53.000.000.000 for all the development process lower than company fair value. The result of company fair value is difference based on every method.