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Freshfields advises Japan Tobacco International on US$1bn acquisition of PT. Karyadibya Mahardhika and PT. Surya Mustika Nusantara

Freshfields Bruckhaus Deringer (“Freshfields”) has advised Japan Tobacco International (‘JTI’) on the acquisition of 100% of the shares in PT. Karyadibya Mahardhika (‘KDM’) and PT. Surya Mustika Nusantara (‘SMN’) from PT. Hari Mahardhika Usaha for US$677m. In addition, JTI will acquire the net interest bearing debt of the two companies for US$323m, bringing the total value of the deal to US$1bn. The transaction is expected to reach completion in the fourth quarter of 2017.
KDM controls various tobacco manufacturing facilities in Indonesia, while SMN is primarily responsible for distribution activities. Together, KDM and SMN employ around 7,500 people and own several prominent kretek cigarette brands in Indonesia including Apache, Extreme and Minna. The transaction represents JTI’s most significant acquisition in Southeast Asia to date, and will give JTI an immediate presence in the Indonesian kretek market, complementing its existing Indonesian tobacco operations.
The Freshfields team advising on the transaction was led by counsel Philip Morgan and partner Rob Ashworth, with support from partner Gavin MacLaren. Partner Alastair Mordaunt led the anti-trust workstream and partner Peter Clements provided tax support. The Freshfields team was assisted by Soemadipradja & Taher, who acted as Indonesian counsel on the transaction.

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The Freshfields team was led by: