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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 TRADEMARK LICENSE 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. 072/2.0095-
00/BS/04/0269/1/VI/2024 dated 28 Juni 2024 regarding fairness opinion on the Transaction.

The Financial Services Authority or OJK: means 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.

Devices: collectively, Device I and Device II.

Device I: means all parts of components, such as heating devices, either in electronic or other forms,
electronic chargers, electronic holders/heaters, cleaners, batteries, electronic spares and other
accessories thereof that are bearing the trademarks of the brand families or unbranded, as determined
by PMPSA or its affiliates and/or registered by PMPSA in the Territory.

Device II: means all component parts, electronic nicotine delivery systems, electronic chargers, electronic
holders/heaters, cleaners, batteries, electronic spares and other accessories thereof that are trademarked
from the brand family, or unbranded, as determined by PMPSA or its affiliates and/or registered by PMPSA
in the Territory.

Trademark License Agreements: collectively, Trademark License Agreement I and Trademark License
Agreement II.

Trademark License Agreement I: means the trademark license agreement signed by PMPSA as the
licensor and the Company as the licensee, effective as of July 1, 2024, in relation with the licensing of
trademarks and/or trademarks that combine PMPSA’s trademarks with the Company's trademarks for use
on or in relation with Product I.

Trademark License Agreement II: means the trademark license agreement signed by PMPSA as the
licensee and the Company as the licensor, effective as of July 1, 2024, in relation with the licensing of
trademarks and/or trademarks that combine PMPSA’s trademarks with the Company's trademarks for use
on or in relation with Product 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.

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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 shares in PMPSA and PMID.

PMPSA: means Philip Morris Products SA, a company incorporated under the Swiss law, engaged in the
manufacturing, trading and marketing of cigarettes, other tobacco products and other nicotine-containing
products.

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.

Products: collectively, Product I and Product II.

Product I: means a set consisting of patented consumable tobacco and/or non-tobacco units specifically
designed for use with Device I by heating (including patented consumable tobacco sticks) which in any
case bears a trademark of the PMPSA’s brand family, is being or has been registered by PMPSA in the
Territory.

Product II: means a set of patented consumable cartridges containing liquid and/or other substances
containing nicotine and, and specifically designed for use with Device II by heating which are in any event
is bearing the trademark of PMPSA’s brand family which are or have been registered by PMPSA in the
Territory or trademarks and/or branding that combine the PMPSA trademark with the Company's
trademark in connection with these products.

Transaction: means collectively (i) the granting of a license from PMPSA to the Company as referred in
the Trademark License Agreement I to be able to manufacture Product I in the Territory; and (ii) the
granting of a license from the Company to PMPSA as referred in the Trademark License Agreement II to
enable PMPSA to manufacture Product II with a trademark and/or branding that combines the PMPSA’s
trademark with the Company's trademark.

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

Territory: means the duty paid and excise tax paid domestic market of the Republic of Indonesia.

                                               INTRODUCTION

This Disclosure of Information is made in connection with the Transaction. The Trademark License
Agreements are Affiliate Transactions according to POJK 42. However, the Trademark License Agreements
are not Transaction with Conflict of Interest as defined under POJK 42 and are not Material Transactions


                                                    2
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as defined under POJK 17, based on an appraisal 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

       PMPSA, as the owner of certain trademarks and other intellectual property rights, including
       patents relating to Product I in the Territory, intends and agrees to grant licenses and/or
       sublicenses of these rights to the Company so that the Company can manufacture and distribute
       Product I in the Territory.

       Furthermore, the Company as the owner of certain trademarks and other intellectual property
       rights intends and agrees to grant licenses and/or sublicenses of these rights to PMPSA so that
       PMPSA can manufacture and distribute Product II in the Territory by combining the PMPSA’s
       trademark with the Company's trademark in the Territory.

       The Company intends to use certain trademarks and other intellectual property rights of PMPSA
       as referred to in the Trademark License Agreement I for the following activities:

       (i) manufacture and distribute Product I in the Territory;
       (ii) make sales of Product I and provide after-sales service for the Devices;
       (iii) import the Product II and Device II, either directly or indirectly through local affiliates of the
             Company in accordance with applicable regulations; and
       (iv) advertising and promotion by the Company for Product I in the Territory.

       In connection with the licensing of the Company's trademarks and certain other intellectual
       property rights to PMPSA as referred to in the Trademark License Agreement II, the Company
       intends to obtain income from royalties that will be paid by PMPSA.

B.     Object of the Agreement

        1. Object of the Transaction

           PMPSA grants to the Company, a non-transferable, non-exclusive, non-sub-licensable license
           (except to subcontractors who have been engaged by the Company) to use the trademarks
           and intellectual property rights owned by PMPSA on Product I, for an indefinite period until
           terminated by either party.

           On the other hand, the Company grants to PMPSA, a non-transferable, non-exclusive, non-
           sub-licensable license (except to sub-contractors who have been engaged by PMPSA) to use
           the trademarks and intellectual property rights owned by the Company on Product II, for an
           indefinite period until terminated by either party.



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      2. Transaction Value

         Based on the Trademark License Agreement I, the royalty paid by the Company to PMPSA is
         5% (five percent) of the Net Sales Value of Product I made by the Company. Furthermore,
         based on the Trademark License Agreement II, the royalty paid by PMPSA to the Company is
         5% (five percent) of the Net Sales Value of Product II made by PMPSA.

         The value of royalty payment for Product I is estimated at IDR 40,882,851,999 on average per
         year and for Product II is estimated at IDR 13,931,620,847 on average per year. Based on the
         above, the value of the Trademark License Agreement I and the Trademark License
         Agreement II, respectively, is 0.14% and 0.05% of the Company's equity based on the
         Company's audited annual financial statements as of December 31, 2023.

         Thus, the Trademark License Agreements are not Material Transactions as defined in POJK 17.

C.   Benefits and Impact of Trademark License Agreements on the Company

     The Trademark License Agreement I allows the Company to legally produce Product I and sell
     Product I and Device I in the Territory so that the Company can maintain its competitive advantage
     by selling a more diversified portfolio of tobacco products and at least can help maintain its
     market share. Meanwhile, the Trademark License Agreement II allows the Company to obtain
     royalty income from PMPSA.

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

     The chart below shows the affiliation relationship between the Company and PMPSA as parties to
     the Trademark License Agreements:




     PMPSA is a business entity incorporated under Swiss law whose registered office is located at Quai
     Jeanrenaud 3, 2000 Neuchatel, Switzerland, engaged in the manufacture, trading and marketing
     of cigarettes, other tobacco products and other nicotine-containing products.



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     PMPSA is an affiliated company of the Company's major shareholder, namely PMID.

     Currently, PMID owns 92.44% shares in the Company. PMID and PMPSA are controlled by PM
     International.

     The current composition of management of PMPSA is as follows:

     President Director           : Jacek Olczak
     Vice President               : Andolina Massimo

E.   Nature of Affiliated Relation between Parties to the Transaction

     As explained above, PMID owns approximately 92.44% of the shares in the Company and is
     therefore the major shareholder of the Company. Furthermore, PMID and PMPSA are owned
     (directly or indirectly) and therefore controlled by PM International. Based on these matters, the
     Company is an Affiliated Party of PMPSA based on the Capital Market Law and POJK 42.

                                           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
     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 Shares   Nominal Value (IDR)         %

        1      Public shareholders holding more than 5% - PMID    107,523,239,925     430,092,959,700         92.44

        2      Other public shareholders                            8,794,836,975         35,179,347,900      7.56




                                                        5
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                              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




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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 Fairness Opinion of the Independent Appraiser
By considering the fairness 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.




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                                    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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unresolved org FINANCIAL SERVICES AUTHORITY p.1 ×5
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unresolved org Philip Morris International Inc. p.3
unresolved person Anwar Mahajudin · Notaris p.6
unresolved org Minister of Justice p.6
unresolved person Notary Aulia Taufani p.6
unresolved org Minister of Law and Human Rights p.6
unresolved org Public shareholders holding more than 5% - PMID p.6
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