SYNERGY CALCULATION OF PT PERUSAHAAN GAS NEGARA’S ACQUISITION PLAN TOWARD PT PERTAMINA GAS

• Main Author: Kusumaningrum, Novi
• Format: Final Project
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/72427
• Institution: Institut Teknologi Bandung

In the era of globalization, it is essential for every company to enhance competitive advantage in order to compete within the industry. To achieve the competitive advantage, companies have to figure out any growth strategies to expand their business. One external growth’s source that often being used is Merger and Acquisition strategy. Recently, Ministry of State Owned Enterprises (SOE) is assigned to form six holding companies in the infrastructure, mining, energy security, banking, agriculture, and renewable energy sectors. The holding companies are expected to increase the efficiency and funding ability of SOE so that they will be financially independent of the State Budget (APBN). Prior to the holding companies forming, it is beneficial that the company with the same business line should be merged first, to ensure that there will be no overlap regarding the operational activity and also to diminish competition between them. The government planned to merge PT Perusahaan Gas Negara Tbk and PT Pertamina Gas to increase the efficiency of national natural gas management and also to reach the target of gas utilization rapidly. PT Perusahaan Gas Negara Tbk, which already control most of Indonesia’s open access pipeline networks will acquire PT Pertamina Gas. Due to many negative opinions and a lot of disapproval from the stakeholders, the acquisition process is still suspended. According to those facts, the purpose of this research is to propose a recommendation for the acquisition decision that will be beneficial as the analysis before establishing holding companies in the energy sector. This research uses macro and micro environmental analysis, discounted cash flow valuation, and synergy calculation. The financial data in this research are collected from the companies’ annual report from the last 5 years and the data from Indonesian Stock Exchange. The results of this research are there will be value of synergy in the amount of $2,846,136,000 for pessimistic scenario, $3,362,411,250 for most likely scenario, and $5,276,281,247 for the optimistic scenario. The value of synergy is built on the assumption that there will be operating synergy and financial synergy after the acquisition. As a recommendation, PT Perusahaan Gas Negara should acquire PT Pertamina Gas by issuing 1,839,738,434 new shares.