SRF and INA Announce the Closing of Co-investment in Indonesian Pharmaceutical Companies

Date：03 March 2023

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On 23 February 2023, Silk Road Fund (SRF) and Indonesia Investment Authority (INA) announced the closing of the investment in PT Kimia Farma Tbk (KAEF) and PT Kimia Farma Apotek (KFA) as their first investment in Indonesia’s healthcare industry.

With the conclusion of this final stage, INA and SRF have officially become the strategic investor of KAEF and KFA by subscribing to KAEF MCB (mandatory convertible bonds) rights offering and acquiring 40% shares in its subsidiary, KFA. During the B20 Summit last November, Conditional Share Subscription and Purchase Agreement and the other transaction documents were signed by SRF, INA, Bio Farma and KAEF.

“The closing of the deal marks the beginning of a new stage of the cooperation between SRF and INA. As a leading integrated pharmaceutical company and top pharmacy retailer in Indonesia, KAEF and KFA have enormous potential to deliver differentiated customer value and better healthcare services. Working closely with our partners, SRF will bring in effective resources to support KAEF and KFA, for them to sharpen their edge and seize opportunities in the promising and fast-evolving healthcare industry in Indonesia. We hope to make this investment a flagship project of China-Indonesia cooperation under the Belt and Road Initiative,” said Zhu Jun, Chairwoman of the Board of Directors of SRF.

The CEO of INA, Ridha Wirakusumah mentioned, “INA is more than ready to support KAEF and KFA’s growth ambition to be the number one healthcare partner for Indonesians. Healthcare in Indonesia presents an attractive opportunity for investors given Indonesia’s market size and rapidly growing middle class. Through this investment, INA aims to accelerate healthcare access across Indonesia, further optimizing existing retail and healthcare delivery channels and expediting healthcare system digitalization to reach a broader cross-section of patients and customers. The development of a Universal Health Coverage system has advanced almost all aspects of the healthcare industry value chain in Indonesia, and we want to be an active player in the ecosystem.”

The KAEF and KFA deal is an important investment made under the Investment Framework Agreement signed by SRF and INA in June 2022. The Agreement aims to build long-term and stable strategic partnership between the two institutions, and to facilitate economic and investment cooperation between China and Indonesia.

About PT Bio Farma (Persero)

Bio Farma is a state-owned company that produces vaccines, antisera, and other biological products (life science). As a world-class and globally competitive life science company, Bio Farma has implemented various integrated systems and is committed to presenting quality products and innovation as demonstrated by its performance that always refers to international standards and the latest quality management systems. For more information, please visit www.biofarma.co.id.

About PT Kimia Farma Tbk

PT Kimia Farma Tbk is a healthcare company with an integrated upstream to downstream businesses in Indonesia. A member of the state-owned pharmaceutical companies, PT Kimia Farma Tbk has several main business fields, namely the development of pharmaceuticals and medicinal raw materials; distribution; marketing; retail pharmaceuticals; laboratories and health clinic. For more information, please visit www.kimiafarma.co.id.

About PT Kimia Farma Apotek

PT Kimia Farma Apotek is a subsidiary of PT Kimia Farma Tbk which is engaged in pharmaceutical retail, especially in the pharmacy sector. There are three business fields run by PT Kimia Farma Apotek and its subsidiaries, which are pharmaceutical retail networks; health clinic services and clinical laboratories. Currently, PT Kimia Farma Apotek has 1,174 pharmacy outlets, 406 health clinic outlets, 72 clinical laboratory outlets spread throughout Indonesia. For more information, please visit www.kimiafarmaapotek.co.id.

About Indonesia Investment Authority (INA)

The Indonesia Investment Authority is Indonesia’s sovereign wealth fund, mandated to increase investment to support the country’s sustainable development and build wealth for its future generations. INA conducts investment activities and collaborates with leading global and domestic investment institutions in sectors that strengthen Indonesia's advantages and provide optimal returns. For more information, please visit www.ina.go.id.

About Silk Road Fund (SRF)

Silk Road Fund is a medium to long term development and investment fund incorporated in China. Through a variety of equity-oriented investment and financing options, Silk Road Fund provides investment and financing support to promote multilateral and bilateral connectivity between China and other countries, as well as their economic and trade cooperation under the Belt and Road Initiative. For more information, please visit www.silkroadfund.com.cn.