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Asset transaction Needs review HMSP

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Page 1
                                    DISCLOSURE OF INFORMATION
                                RELATED TO AFFILIATED TRANSACTIONS

THIS DISCLOSURE OF INFORMATION HAS BEEN MADE TO COMPLY WITH THE FINANCIAL SERVICES AUTHORITY (“OJK”)
REGULATION NO. 42/POJK.04/2020 DATED 2 JULY 2020 ON AFFILIATED TRANSACTIONS AND CONFLICT OF INTEREST
TRANSACTIONS (“POJK 42”) IN CONNECTION WITH THE EXECUTION OF LEASE AGREEMENT.
THE INFORMATION CONTAINED IN THIS DISCLOSURE OF INFORMATION IS IMPORTANT TO BE READ AND NOTED BY THE
COMPANY’S SHAREHOLDERS. IF YOU FIND DIFFICULTIES IN UNDERSTANDING THE INFORMATION SET FORTH IN THIS
DISCLOSURE OF INFORMATION, YOU ARE SUGGESTED TO CONSULT WITH YOUR BROKER, INVESTMENT MANAGER, LEGAL
COUNSEL, PUBLIC ACCOUNTANT OR OTHER PROFESSIONAL ADVISORS.
THE BOARD OF DIRECTORS AND THE BOARD OF COMMISSIONERS ARE, JOINTLY AND SEVERALLY, FULLY RESPONSIBLE FOR
THE TRUE AND CORRECTNESS, AND COMPLETENESS OF THE INFORMATION DISCLOSED HEREIN AND IN ANY ADDITIONAL
DISCLOSURE, IF ANY, AND HEREBY CONFIRM THAT THE INFORMATION CONTAINED IN THIS DISCLOSURE OF
INFORMATION IS CORRECT, AND THERE IS NO SIGNIFICANT, MATERIAL AND RELEVANT FACT THAT HAS NOT BEEN
DISCLOSED OR HAS BEEN REMOVED SUCH THAT THE DISCLOSURE OF INFORMATION HEREIN BECOMING INCORRECT
AND/OR MISLEADING.
AFTER CAREFUL EXAMINATION, THE COMPANY'S BOARD OF DIRECTORS AND BOARD OF COMMISSIONERS, JOINTLY AND
SEVERALLY STATES THAT THESE AFFILIATED TRANSACTIONS ARE NOT CONSTITUTE A MATERIAL TRANSACTION AS MEANT
BY POJK 17 (AS DEFINED IN THIS DISCLOSURE OF INFORMATION) AND DO NOT CONTAIN ANY CONFLICT OF INTEREST AS
MEANT BY POJK 42.
THE BOARD OF DIRECTORS OF THE COMPANY, BOTH JOINTLY AND SEVERALLY STATES THAT THESE AFFILIATED
TRANSACTIONS HAVE WENT THROUGH ADEQUATE PROCEDURES TO ENSURE THAT THESE AFFILIATED TRANSACTIONS
ARE IMPLEMENTED IN ACCORDANCE WITH THE GENERALLY APPLICABLE BUSINESS PRACTICES.




                               PT HANJAYA MANDALA SAMPOERNA Tbk.
                                         (the “Company”)

                                          Domiciled in Surabaya
                                              Business Line:
                                            Cigarette Industry
                                               Head Office:
                     Jl. Rungkut Industri Raya No. 18, Surabaya 60293, Indonesia
                         Telephone: 031 – 843 1699, Facsimile: 031 – 843 0986
                                             Factory Location:
                   Surabaya, Pasuruan, Malang, Karawang, Probolinggo, Blitar, Tegal
                                   Corporate Representative Office:
                    One Pacific Place, 18th Floor, Sudirman Central Business District,
                                     Jl. Jend. Sudirman Kav. 52-53,
                                         Jakarta 12190, Indonesia
                         Telephone: 021 – 515 1234, Facsimile: 021 – 515 2234

                 This Disclosure of Information is published in Jakarta on July 2, 2024
Page 2
                                                 DEFINITIONS


Disclosure of Information: means the disclosure of information related to affiliated transaction as
specified in the announcement and/or disclosure of information and any additional information that may
or will be made available.

Fairness Opinion Report: means a report submitted by the Independent Appraiser No. 00074/2.0095-
00/BS/04/0269/1/VI/2024 dated 28 June 2024 regarding fairness opinion on the Transaction.

Lease Object I: are several buildings/rooms/areas with a total area of 841 m2, located at One Pacific Place
Building, 16th - 19th floor, Sudirman Central Business District (SCBD), Jl. Jend. Sudirman, Kav. 52-53, Jakarta
12190.

Lease Object II: are several buildings/rooms/areas with a total area of 3,283 m2 located at Jalan Rungkut
Industri Raya No. 18, Surabaya.

The Financial Services Authority or OJK: is the independent institution as set forth under Law No. 21 of
2011 on the Financial Services Authority (“OJK Law”), who has the regulatory and supervisory duties and
authorities over the sectors of banking, capital market, insurance, pension fund, financing and other
financial institutions, and as of December 31, 2012, OJK is the institution that has replaced and accepts
the rights and obligations to run the regulatory and supervisory functions from Bapepam and/or Bapepam
and LK pursuant to Article 55 of the OJK Law.

Independent Appraiser: means the public appraiser firm of KJPP Ruky, Safrudin & Rekan, an independent
appraiser registered with OJK that has been appointed by the Company to appraise the fairness of the
Transaction.

Agreement: means Lease Agreement No. 11638/PMSISC/795/5/2024 signed by the Company as the lessor
and PMSISC as the lessee dated June 29, 2024, with effect from June 30, 2024, in relation to the lease of
Lease Object I and Lease Object II.

The Company: means PT Hanjaya Mandala Sampoerna Tbk., a publicly listed company incorporated under
and subject to the laws of Indonesia, domiciled in Surabaya, Indonesia.

PMID: means PT Philip Morris Indonesia, the major shareholder of the Company, a limited liability
company incorporated under the laws of Indonesia, engaged in the white cigarette industry.

PM International: means Philip Morris International Inc., a business entity incorporated under the laws
of the Commonwealth of Virginia, United States, engaged in the manufacturing and trading of cigarettes,
other tobacco products and other nicotine-containing products marketed outside the United States, and
owns, directly or indirectly, 100% of the issued shares in Philip Morris Products SA and PMID.

PMSISC: means PT Philip Morris Sampoerna International Service Center, a limited liability company that
is a subsidiary of the Company's major shareholder, namely PMID, which was incorporated under the laws
of Indonesia, engaged in management consulting and computer programming.


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POJK 17: means The Financial Services Authority Regulation No. 17/POJK.04/2020 dated 21 April 2020, on
Material Transactions and Changes in Main Business Activities.

POJK 42: means The Financial Services Authority Regulation No. 42/POJK.04/2020 dated 2 July 2020, on
Affiliated Transactions and Conflict of Interest Transactions.

Transaction: means a leasing activity between the Company as the lessor and PMSISC as the lessee for
the Lease Object I and the Lease Object II.

Capital Market Law: means Law No. 8 of 1995 dated 10 November 1995 on Capital Market.

                                              INTRODUCTION

This Disclosure of Information is made in connection with the Transaction. The Agreement is an Affiliated
Transaction according to POJK 42. However, the Agreement is not a Transaction with Conflict of Interest
as defined under POJK 42 and is not a Material Transaction as defined under POJK 17, based on an
assessment report from the Independent Appraiser regarding the fairness of the Transaction, the
summary of which is presented in Section III of this Disclosure of Information.


                                  I. DESCRIPTION ON THE TRANSACTION


A.      Background and Reasons for the Transaction

        The Company has several buildings/rooms that are not currently being used by the Company in
        the building area or complex where Lease Object I and Lease Object II are located. At the same
        time, PMSISC needs several buildings/rooms/areas to be used as offices and its supporting areas
        so that PMSISC can carry out its business activities well.

        The purpose of this Transaction is to optimize the utilization of unused assets so that it can
        generate income for the Company.

        The Transaction is not carried out by the Company with non-affiliated party of the Company
        because the provision of the services by an affiliated party can be provided more quickly,
        effectively, efficiently and better coordinated than if similar transaction were carried out with a
        non-affiliated party.

B.      Object of the Agreement

         1. Object of the Transaction

            Based on the Agreement, the Company leases Lease Object I and Lease Object II to PMSISC.
            Here are the complete details about Lease Object I and Lease Object II:

            (i) Lease Object I



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            Several buildings/rooms/areas covering an area of 841 m2 (eight hundred and forty-one
            square meters), which are part of a building with a total building area of 9,290 m2 (nine
            thousand two hundred and ninety square meters) and located at One Pacific Place
            Building, 16th - 19th floor, Sudirman Central Business District (SCBD), Jalan Jendral
            Sudirman Kav 52-53, Jakarta 12190; and

        (ii) Lease Object II
             Several buildings/rooms/areas covering an area of 3,283 m2 (three thousand two hundred
             and eighty-three square meters), which are part of a building with a total building area of
             5,378 m2 (five thousand three hundred and seventy-eight square meters), and located at
             Jalan Rungkut Industri Raya, Number 18, Surabaya.

     2. Transaction Value

        The Agreement is valid for 3 (three) years, starting from June 30, 2024, up to and including
        June 29, 2027, with a total lease fee of IDR.20,038,500,000 (twenty billion thirty-eight million
        five hundred thousand Rupiah) (excluding Value Added Tax). This value is in accordance with
        the fair market value of office rental as of December 31, 2023, based on a business appraisal
        conducted by the Independent Appraiser.

        The Company will issue an invoice related to the lease fee for Lease Object I and Lease Object
        II to PMSISC, and PMSISC will make payment to the Company for the lease fee no later than
        30 (thirty) days after the date of issuance of the invoice by the Company.

        The payment of the lease fee is made using an upfront payment mechanism by the Company,
        namely after the execution of the Agreement.

        The total value of Transaction is 0.07% of the Company's equity based on the Company's
        audited consolidated financial statements as of December 31, 2023. Thus, the Transaction is
        not a Material Transaction as defined in POJK 17, because the value of the Transaction is not
        more than 20% (twenty percent) of the Company's equity.

C.   Parties to the Transaction and Their Relationships with the Company

     The chart below shows the Company's share ownership and the parties conducting the
     Transaction:

                                        PT Philip Morris Indonesia




                           92,44%                                       99,9%


              PT Hanjaya Mandala Sampoerna Tbk.               PT Philip Morris Sampoerna
                                                              International Service Center



     Information on the parties who entering Transaction with the Company:


                                                   3
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     PT Philip Morris Sampoerna International Service Center
     PMSISC is a limited liability company established under the laws of the Republic of Indonesia,
     engaged in management consulting and programming activities, is a subsidiary of PT Philip Morris
     Indonesia which is the major shareholder of the Company. PMSISC was established based on the
     Deed of Establishment of a Limited Liability Company No. 3 dated January 18, 2018, made before
     Dorothea Nawang Wulan, SH, MKn, Notary in the Administrative City of East Jakarta which has
     been approved by the Minister of Law and Human Rights of the Republic of Indonesia No. AHU-
     0003602. AH.01.01. Year 2018 dated January 25, 2018 ("Deed No.3/2018").

     The capital structure and shareholding composition of PMSISC based on Deed No.3/2018 are as
     follows:

           Authorized Capital             : Rp. 40.400.000.000     Nominal value : IDR 10,100,000/shares
           Issued and Paid-Up Capital     : Rp. 10.100.000.000

           No                            Name                    Number of       Nominal Value         %
                                                                  Shares            (IDR)

            1   PMID                                                      999    10,089,900,000      99,9

            2   Park Tobacco Limited                                         1       10,100,000        0,1

                                        Total                          1.000     10,100,000,000       100


     The current composition of members of the Board of Directors and the Board of Commissioners
     of PMSISC is as follows:

     Commissioner               : Celicia Sari
     Director                   : Salomo L. Gaol

D.   Nature of Affiliated Relation between Parties to the Transaction

     The relationship between the parties carrying out the Transaction is an Affiliate relationship as
     stipulated in the Capital Market Law and POJK 42, which is a relationship between two companies
     that are controlled, either directly or indirectly, by the same party.


                                         II. DESCRIPTION ON THE COMPANY


A.   History

     The Company is a publicly listed limited liability company established under the laws of the
     Republic of Indonesia within the framework of the Indonesian Capital Investments Law. The
     Company was established on October 19, 1963, by virtue of Deed No. 69 dated October 19, 1963,
     which was amended by Deed No. 46 dated April 15, 1964, both drawn up before Anwar
     Mahajudin, S.H., Notary in Surabaya, which have been approved by the Minister of Justice of the
     Republic of Indonesia by virtue of his Decree No. J.A.5/59/15 dated April 30, 1964, and have been

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     published in the State Gazette of the Republic of Indonesia No. 94 dated November 24, 1964,
     Supplement No. 357. The articles of association of the Company have been amended several
     times, lastly by virtue of Deed No. 41 dated June 9, 2022, drawn up before Notary Aulia Taufani,
     S.H., which has obtained approval from the Minister of Law and Human Rights of the Republic of
     Indonesia by virtue of his Decree No. AHU-0044445.AH.01.02.TAHUN 2022, dated June 29, 2022.

B.   Capital Structure and Shareholding Composition

     The capital structure and the shareholding composition of the Company based on Shareholders’
     Register of the Company as June 21, 2024, are as follows:


       Authorized Capital: IDR 630,000,000,000                      Nominal Value   : IDR 4/share
       Subscribed and Issued Capital: IDR 465,272,307,600


        No                      Name                       Number of           Nominal Value          %
                                                             Shares                 (IDR)
        1    Public shareholders holding more than 5% - 107,523,239,925        430,092,959,700      92.44
             PMID
        2    Other public shareholders                    8,794,836,975         35,179,347,900      7.56
                               Total                    116,318,076,900        465,272,307,600      100

C.   Capital Structure and Shareholding Composition

     The compositions of members of the Board of Commissioners and of the Board of Directors of the
     Company pursuant to Deed No. 4 dated June 7, 2024, drawn up before Aryanti Artisari, S.H.,
     M.Kn., Notary in Administrative City of South Jakarta, which has obtained the Receipt of the
     Notification of Changes in the Company's Data from the Minister of Law and Human Rights No.
     AHU-AH.01.09-0215933 dated June 20, 2024, are as follows:

     The Board of Commissioners
     President Commissioner                      :       John Gledhill
     Vice President Commissioner                 :       Paul Norman Janelle
     Independent Commissioner                    :       Justin Guy Mayall
     Independent Commissioner                    :       Luthfi Mardiansyah

     The Board of Directors
     President Director                          :       The Ivan Cahyadi
     Director                                    :       Sergio Colarusso
     Director                                    :       Elvira Lianita
     Director                                    :       Andre Dahan
     Director                                    :       Gunnar Beckers
     Director                                    :       Johan Bink
     Director                                    :       Sharmen Karthigasu
     Director                                    :       Yohan Lesmana




                                                     5
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                         III. SUMMARY OF OPINION OF THE INDEPENDENT APPRAISER


To ensure fairness of the Transaction and also to ensure that the Transaction do not have a conflict-of-
interest element, the Company has appointed Ruky, Safrudin & Rekan as the Independent Appraiser
carrying out the assessment of the fairness of the Transaction.

The Independent Appraiser states that it has no affiliate relationship either directly or indirectly with the
Company as defined under the Capital Market Law.

Summary of Opinion of the Independent Appraiser
A.    Lease Asset Valuation Summary
      Identity of the Valuer
      KJPP Ruky, Safrudin dan Rekan has a business license from the Ministry of Finance of the Republic
      of Indonesia No. 2.11.0095 based on the Decree of the Minister of Finance of the Republic of
      Indonesia No. 533/KM.1/2016 dated June 16, 2016 and registered as capital market supporting
      professional in OJK according to Registered Letter of Capital Market Supporting Professional
      (Business Valuer) No. STTD.PP-28/PJ-1/PM.02/2023.

      Object of the Valuation
      1. Office space with area 841 sq.m, located at One Pacific Place Lantai 16 - 19, Sudirman Central
         Business District, Jalan Jend. Sudirman Kav. 52-53, Kelurahan Senayan, Kecamatan Kebayoran
         Baru, Kota Jakarta Selatan, Provinsi DKI Jakarta.
      2. Office space with area 3.283 sq.m, located at Unit 2, 3, 4, 5 dan 11, Jalan Rungkut Industri
         Raya No. 18, Kelurahan Rungkut Tengah, Kecamatan Rungkut, Kota Surabaya, Provinsi Jawa
         Timur.

      Purpose of the Valuation
      To provide an opinion on Market Rent Value for the purposes of rental property object transactions
      for 3 years (2024 - 2026), not for banking purposes and not for other forms of transaction plans.

      Assumptions and Disclaimer Limitations
      1. The ownership of properties which included in this appraisal is considered legally valid.
      2. All disputes lawsuit and mortgages that are still running, if any, can be ignored and the property
         being valued as if clean under owner’s responsibility.
      3. This appraisal is based on a list of assets that have been given by the Assignor.
      4. Appraiser(s) have been reviewing the documents used in the appraisal process.
      5. Appraiser(s) does not verify the legality since appraiser are not lawyer in the field of law, we
         assume that the documents concerning to the property are good, marketable, and free from
         any disputes or other bindings.
      6. Appraiser(s) does not conduct an investigation and neither is the responsibility of the
         appraiser(s) if there are issues relating to the property rights or debt/losses on the property
         being valued.



                                                     6
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     7. To the extent within the known knowledge of the appraiser, any data and facts presented in
         this report is true and accurate.
     8. The value in the conclusion is stated in Rupiah based on the understanding that the market for
         property is denominated in Rupiah.
     9. The report is in bilingual format. Digit grouping symbol in this report using Indonesian format
         by using symbol ". (point) ".
     10. This report is in bilingual format, if there are different interpretations of both, Indonesian is
         preferred.
     Pendekatan dan Metode
     By paying attention to the scope of work and referring to the Republic of Indonesia Financial
     Services Authority Regulation No. 28/ POJK.04/2021, the Income Approach with the Discounted
     Cash Flow (DCF) Method, where the annual rent for location 1 is using the Market Data Comparison
     Method and location 2 using the Market Data Comparison Method and the Reconciled Gross
     Income Multiplier is the most appropriate to use, considering the characteristics of the asset.
     Conclusion
     Conclusion of 3 Years Market Rent Value amount to Rp 20.038.500.000,- (Twenty Billion Thirty Eight
     Million Five Hundred Thousand Rupiah).

B.   Summary of Fairness Opinion
     Identity of the Valuer
     KJPP Ruky, Safrudin dan Rekan has a business license from the Ministry of Finance of the Republic
     of Indonesia No. 2.11.0095 based on the Decree of the Minister of Finance of the Republic of
     Indonesia No. 1131/KM.1/2011 dated October 14, 2011 and registered as capital market supporting
     professional in OJK according to Registered Letter of Capital Market Supporting Professional
     (Business Valuer) No. STTD.PB-23/PJ-1/PM.02/2023.
     Object of The Fairness Opinion Analysis
     The object of fairness analysis is the Company plan to lease the Rental Object to PMSISC.
     The Purpose of This Fairness Opinion
     The purpose of this Fairness Opinion report is to provide opinion on the fairness of the Company
     plan to lease the Rental Object to PMSISC as outlined in this report in order to comply with POJK
     42/2020, not for taxation purpose, banking and not for other forms of transaction plan.

     Assumptions and Disclaimer Limitations
     This Fairness Opinion Report is a non-disclaimer opinion, we have reviewed the documents used in
     the process of preparing the fairness opinion, data and information obtained from both
     management of the Company and other reliable sources that can be trusted for accuracy.

     This Fairness Opinion Report has been prepared using Incremental Financial Projection provided by
     management of the Company by reflecting the fairness of the projections and the ability to achieve
     them (fiduciary duty).

     This fairness opinion is prepared based on the integrity of the information and data. In preparing
     this fairness opinion, we have relied and based on the information and data prepared by the
     Company’s management, which we deem to be true, complete, reliable and not misleading.

     Methodology for Fairness Analysis

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      In evaluating the fairness of the Proposed Transactions, we used the following methodology
      analysis:
        1. Proposed Transactions Analysis: identification of parties involved in the Proposed
           Transactions, and analysis of benefit and risk of the Proposed Transactions;
        2. Qualitative analysis: analysis of background of the Proposed Transactions, brief explanation
           of the Company and business activities, industry analysis, operational analysis, business
           prospect, advantages and disadvantages of the Proposed Transactions;
        3. Quantitative analysis: historical analysis, analysis of proforma financial statements, and
           incremental financial projections analysis;
        4. Analysis of other relevant factors, in the form of analysis of relevant costs and revenues,
           relevant non-financial information that can provide confidence in providing a fairness opinion;
        5. Analysis on the Fairness of the Proposed Transactions Price;

      Fairness Opinion of the Transactions
      By considering the fairness analysis of the Proposed Transactions which includes analysis of the
      Proposed Transactions, qualitative analysis and quantitative analysis, analysis of the fairness of the
      transaction price and other relevant factors, in RSR's opinion, the Proposed Transactions are fair.

           IV. STATEMENT OF THE BOARD OF DIRECTORS AND BOARD OF COMMISSIONERS


In connection with the Transaction, the Board of Directors and the Board of Commissioners of the
Company declare that, after conducting a reasonable examination and to the best of their knowledge and
belief, all material information has been disclosed in this Disclosure of Information and such information
is not misleading.


                                       V. ADDITIONAL INFORMATION


Shareholders who have questions about this Disclosure of Information or who wish to have additional
information are invited to contact:



                            The Corporate Secretary and Investor Relations
                              PT HANJAYA MANDALA SAMPOERNA Tbk.
                                     One Pacific Place, 18th Floor,
                                  Sudirman Central Business District,
                                    Jl. Jend. Sudirman Kav. 52-53,
                                        Jakarta 12190, Indonesia
                                      Telephone: 021 – 515 1234
                                       Facsimile: 021 – 515 2234

                                                                                      Jakarta, July 2, 2024
                                                                    The Board of Directors of the Company


                                                     8

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Names mentioned 37 people and organisations named in the text · linked when the evidence is strong

linked org HANJAYA MANDALA SAMPOERNA Tbk. p.1 ×11
linked org PT Philip Morris Indonesia p.2 ×5
linked org Philip Morris p.2
linked org Philip Morris Products p.2
linked person John Gledhill p.6
linked person Paul Norman Janelle p.6
linked person Justin Guy Mayall p.6
linked person Luthfi Mardiansyah p.6
linked person The Ivan Cahyadi p.6
linked person Sergio Colarusso p.6
linked person Elvira Lianita p.6
linked person Andre Dahan p.6
linked person Gunnar Beckers p.6
linked person Johan Bink p.6
linked person Sharmen Karthigasu p.6
linked person Yohan Lesmana p.6
possible — Central Business p.1 ×5
unresolved org FINANCIAL SERVICES AUTHORITY p.1 ×6
unresolved org Bapepam p.2 ×4
unresolved org KJPP Ruky p.2 ×3
unresolved org Safrudin & Rekan p.2 ×2
unresolved org Philip Morris International Inc. p.2
unresolved org PT Philip Morris Sampoerna International Service Center p.2
unresolved org PT Philip Morris Sampoerna International Service Center Information p.4
unresolved org PT Philip Morris Sampoerna International Service Center PMSISC p.5
unresolved person Dorothea Nawang Wulan · Notaris p.5
unresolved org Minister of Law and Human Rights p.5 ×2
unresolved — PMID p.5
unresolved org Park Tobacco Limited p.5
unresolved person Anwar Mahajudin · Notaris p.5
unresolved org Minister of Justice p.5
unresolved person Notary Aulia Taufani p.6
unresolved person Aryanti Artisari · Notaris p.6
unresolved org Safrudin dan Rekan p.7 ×2
unresolved org Ministry of Finance p.7 ×2
unresolved org Minister of Finance p.7 ×2

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