What have been some of the big trends you have witnessed in the M&A space – either in Indonesia or regionally – in the past year? How did these impact your practice?
It is not surprising that the brightest silver lining has been the increase of digitilization. It opens up many possibilities from doing fintechs to data centers. The impact is that it requires lawyers to be more sophisticated and to have the ability to synthesize things, to see things as interlinked and in holistic ways.
Tell us about some of your notable deals from the past 12 months. Can you talk in detail about one or two interesting ones, and the role you played in them?
The twin but separate transactions of the sale of Bank Permata Tbk. by Standard Chartered Bank and Astra International Tbk. to Bangkok Bank are perfect examples. This USD 2.14 billion deal was a complex cross-border M&A transaction involving parties from the UK, Thailand and Indonesia. I was trusted as the lead partner to represent both SCB and Astra (a big Indonesian conglomerate). I proactively guided all parties through complex regulatory issues and was able to structure the sale of the 89.12% shares through a one-step sale.
Immediately after the completion of the sale, I was appointed to do the complex business transfers from Bangkok Bank’s branches to Bank Permata Tbk. I was appointed because this transaction followed the path of HSBC - Bank Ekonomi (the first business integration ever done) which I led in 2017. From a business point of view, full business integration is a merger, but legally it cannot use a merger framework because a branch cannot merge into a subsidiary. This is also the first transaction at this scale that was done fully virtual because of the pandemic, from the start until the completion of the transaction, which increased the executional efficiency, taking only around six months.
In doing complex M&A transactions, I felt that my unique background and wide-ranging experience as an ex-regulator, an investment banker and now a lawyer, as well as the combination of MBA and LL.M. education, enabled me to provide cross-disciplinary, commercial, and strategic approaches that are greatly valued by clients.
What challenges did COVID-19 bring to your work? How did you look to overcome these challenges?
The greatest challenge is that you no longer have the luxury to be in the same space as your team in leading multiple transactions. This is when you realize the utmost importance of investing in good training and building trust-based relationship in your team. I have always been a big believer of “distributed leadership”, so I have been training and equipping my team to own responsibilities and to have a certain level of autonomy to react accordingly in the “battleground”. This proves very fruitful when you do not have the usual supervision visibility.
Paradoxically, during this pandemic, we find that we have more time to do many transactions because we did not spend time in traffic jams. Since the pandemic started in February last year we have handled and closed many M&A transactions. Virtual meetings are great for big transactions. In the recent merger of three banks to become Bank Syariah Indonesia Tbk., we had many virtual calls, on one occasion with 110 attendees. Even with many attendees, virtual meet-ings started and ended punctually.
Clients today have higher requirements when it comes to the services they receive from their lawyers. Can you provide an example or two of how you went the extra mile for your clients?
I was an investment banker so I was a client of lawyers. In fact, I still maintain a “client mentality” even though I am a lawyer now. After all, we are all a client of somebody. We are in the service business and service is not transactional, but it relies on a mutual trusting relationship. It naturally becomes like a friendship, so you do not feel that you are going the extra mile when you do your best for the clients.
What motto do you live by?
Always try to treat others as you want to be treated. I find this motto is liberating because it is proactive and not reactive. You are the one that is in control. Being in the service business, the motto means once you are being appointed, you just strive to give the best service because you expect the same from your service providers.
Erwandi Hendarta
Senior Partner
E: erwandi.hendarta@bakermckenzie.com
HHP Law Firm
Pacific Century Place
Level 35 Sudirman Central Business District
Lot 10, Jl. Jendral Sudirman Kav 52-53
Jakarta 12190, Indonesia
T: (62) 21 2960 8888
F: (62) 21 2960 8999
W: www.bakermckenzie.com
