Matahari Department Store Owned By Conglomerate Mochtar Riady Wants To Buy Back Shares Worth IDR 500 Billion

Matahari Department Store outlet (Photo: Doc. Antara)

JAKARTA - The retail company from the Lippo Group owned by conglomerate Mochtar Riady, PT Matahari Department Store Tbk (LPPF) plans to continue its share buyback action this year.

"The buyback of shares II 2022 will be carried out after the company has disclosed this information. The repurchase of shares II 2022 will be carried out starting from the date of this information disclosure until June 3, 2022," wrote Matahari Department Store Management in an information disclosure, quoted on Tuesday 10 May.

LPPF has prepared a maximum fund of IDR 500 billion for share buybacks, which includes brokerage fees and other costs.

LPPF will buy back shares of up to 10 percent of the paid-up and issued capital or a maximum of 262.61 million shares. The company also limits the maximum buyback price of IDR 7,950 per share.

Meanwhile, LPPF's net loss per share as of December 31, 2021, was recorded at IDR351 per share, while the pro forma net profit (loss) per share if the 2022 share repurchase was carried out in a maximum amount, was IDR 431.

Management hopes that the phase II buyback will not affect business and operational activities because LPPF already has sufficient working capital to run business activities.

"The management believes that the company's current market value is below what it should be, and expects the share buyback will increase the company's market value," the management wrote.

On the stock exchange, Matahari Department Store shares fell 6.90 percent to IDR 5,400 at the close of trading Monday 9 May. Since the beginning of the year, LPPF's share price has increased by 30.12 percent with a decrease of 0.48 percent with a market capitalization of IDR 14.18 trillion.

Previously, LPPF also bought back shares in the period February 4-April 28 2022 as much as 2.48 percent of the company's paid-up and issued capital or as much as 65.07 million shares. The costs incurred for the implementation of the buyback for this period were IDR 327.37 billion, including brokerage fees and other costs related to the buyback.