Animal Feed Producer Charoen Pokphand to Acquire 7-Eleven Outlets in Indonesia
Jakarta. Charoen Pokphand Indonesia, a local unit of Thai conglomerate Charoen Pokphand, wants to acquire 7-Eleven convenience stores operated by Modern Sevel Indonesia, a subsidiary of publicly listed Modern Internasional, for Rp 1 trillion ($75 million).
The transaction was signed on April 19 and will be completed by June 30, after securing the regulatory approval, the company said in a filing to the Indonesia Stock Exchange (IDX) last week.
After the transaction, Charoen will be able to distribute its processed food products and packaged drinks through 7-Eleven outlets. The animal feed producer will use its internal cash to fund the acquisition.
The company has recently expanded its businesses to production of packaged chicken nuggets under the brands of Golden Fiesta, Fiesta, Champ and Okey. Charoen also produces packaged tea drinks named Fiesta White Tea. It already operates 7-Eleven stores, with more than 9,500 outlets in Thailand alone.
The number of 7-Eleven outlets operated by Modern Sevel was 175 as of September and most of them are located in Jakarta.
Its parent company, Modern Internasional, decided to sell 7-Eleven outlets because the stores are struggling in competition with local chains Alfamart and Indomart. In addition, its sales plummeted after the government regulation from 2015 that banned sales of alcohol beverages by small retailers.
The company posted a decline in net revenue by almost 50 percent, to Rp 660.67 billion as of September.
Modern Internasional started its business as a distributor for FujiFilm products in Indonesia. Later it became the distributor of Japanese medical equipment brands Shimadzu and Sirona. It also provides document management solutions under its unit Modern Data Solusi.
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