Indonesian Fund and Mitsui vies for a $300 Million Stake in Toll Operator RKE

Prospective buyers of CVC Capital Partners' 25% stake in Indonesian toll road operator RKE International, valued at up to $300 million, include Indonesia's sovereign wealth fund, the Indonesia Investment Authority (INA), and Japan's Mitsui & Co.

CVC, a Luxembourg-based investment firm, began the process of selling its 25% stake in RKE International, also known as Road King Expressway International Holdings, late last year. According to one of the sources, the sale sparked interest from a number of financial investors and strategic companies.

According to reports, the potential transaction could be worth between $250 million and $300 million for CVC's stake or up to $1 billion for the entire company.

RKE International's remaining stake is owned by Hong Kong-listed property development and infrastructure group Road King Infrastructure.

The CVC declined to comment. RKE International and Road King did not respond to emails requesting comment. INA stated that it was unable to comment on the matter. Mitsui declined to comment on individual matters.

The sale comes as global investors are increasingly interested in infrastructure assets in Southeast Asia, drawn by the region's growth prospects and the sector's stable and long-term returns in the face of global uncertainty.

RKE International's current toll road portfolio consists of four Indonesian expressways spanning approximately 335 kilometers (208.2 miles) in total, located in the provinces of Central Java and East Java.

According to Road King's website, RKE International's current toll road portfolio consists of four Indonesian expressways totaling approximately 335 kilometers (208.2 miles) in length and located in the provinces of Central Java, East Java, and North Sumatra.

According to an announcement from 2018, CVC invested 2 billion Hong Kong dollars ($256.7 million) in RKE International, which at the time had a portfolio of expressways in China.

RKE International sold its Chinese expressway assets to Hong Kong-based Cornerstone Holdings Ltd. in November 2023 for 4.4 billion yuan ($606.8 million), according to stock exchange filings. ($1 equals 7.7918 Hong Kong dollars.) ($1 equals 7.2507 Chinese yuan) (Reported by Yantoultra Ngui; edited by Jacqueline Wong).