Danantara takes over US$9.5 billion in assets to create Indonesia’s largest fund manager
Fund wants to expand access to investment products for both retail and institutional investors
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[JAKARTA] Indonesia’s sovereign wealth fund Daya Anagata Nusantara (Danantara) has taken control of four state-owned investment management companies overseeing a combined 170 trillion rupiah (US$9.5 billion) in assets.
This creates what will become the country’s largest asset manager as the government pushes to consolidate state-owned financial institutions.
Danantara Asset Management (DAM), the asset management arm of Danantara, signed share-purchase agreements on Wednesday (Jul 22) to acquire controlling stakes in Mandiri Manajemen Investasi, BRI Manajemen Investasi, BNI Asset Management and PNM Investment Management. The agreements formally transfer control of the four firms to DAM.
Within the next month, the companies will be merged into a single investment management company as part of Danantara’s broader restructuring of state-owned enterprises.
Dony Oskaria, chief operating officer of Danantara, said in a statement on Thursday that the merger would create a stronger investment manager capable of supporting the development of Indonesia’s capital markets while strengthening the country’s asset management industry.
The consolidation would combine the firms’ investment expertise, distribution networks and investor base under a single platform with stronger governance, he noted.
The acquisition marks Danantara’s latest move to combine the management of state-owned assets as President Prabowo Subianto pushes to streamline Indonesia’s sprawling state-owned enterprise sector.
Since taking office, his administration has sought to consolidate 1,000 state-owned companies into around 200 entities under Danantara to improve governance, reduce overlaps and strengthen the government’s control over strategic assets.
Danantara Indonesia was established in February last year as an independent state investment agency reporting directly to the president.
The latest merger also comes as Indonesia’s retail investment market continues to deepen, with 27 million registered investor accounts as at May, creating a larger pool of potential customers for mutual funds and other investment products.
Danantara noted that the combined company will seek to expand access to investment products for both retail and institutional investors.
On the retail side, it plans to develop thematic investment products and leverage the distribution networks of Indonesia’s state-owned banks, to reach a growing investor base.
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