Shares in mobile phone retailer Global Teleshop surged in their fourth day of trading after Trikomsel Oke said it had completed the acquisition of a majority stake in it for almost Rp 1 trillion ($106 million).
Global’s stock advanced 15 percent to Rp 1,250 on Friday, its highest since its trading debut on Tuesday.
The news that prompted the rise was that Trikomsel, another mobile phone distributor, announced a plan to buy 800 million Global shares from Trilinium, an existing shareholder, for Rp 910 billion.
Trikomsel bought the Global shares at Rp 1,137.64 apiece, the company said in a statement on Friday. After the acquisition, Trikomsel, which did not previously have a stake in the company, will hold 72 percent of Global.
Analysts say the acquisition is part of Trikomsel’s broader plan to become the biggest mobile phone distributor in Indonesia, where demand for new mobile phone handsets is rising.
Trikomsel hired Equator Securities and Lautandhana Securindo to manage the acquisition.
Trikomsel raised Rp 1.07 trillion in fresh funds from secondary share sales and bond issuance last month to finance the acquisition.
Shares in Trikomsel also jumped on the news, rising 3.5 percent to Rp 900 on Friday. They are up 1.1 percent this year.
Global will help Trikomsel expand its market share among middle- and upper-income consumers, where Global already has a strong position for the sale of smartphones and tablets, the statement said. Global operates Samsung Stores among others and is also licensed as an Apple Premium Reseller.
Meanwhile, Trikomsel’s OkeShop focuses on middle- and lower-income consumers.
The acquisition will “elevate Trikomsel’s position as the largest distribution network in Indonesia,” Juliana Samudro, a director and corporate secretary at Trikomasel, said in the statement, adding that it would reach 175 cities in all 33 provinces across Indonesia.
By the end of the first quarter, Trikomsel had 795 OkeShop outlets across the country and distribution partnerships with about 15,000 independent retailers.
Meanwhile, as of June, Global had 313 outlets and a distribution network of about 37,500 independent retailers.
Global is adding 60 to 100 new outlets this year to expand its market share and has set aside up to Rp 50 trillion in cash to finance the opening of new outlets.
The company raised Rp 127.8 billion in fresh fund by selling off a 10 percent stake in its initial public offering earlier this month.