A Life Story of My Uncle, Benny Subianto

A life story of my uncle, Benny Subianto, that always remind me that my journey is STILL ALWAYS long way to go.
Stay Humble, Focus The Aim and Keep Working Hard.

FORBES ASIA 11/20/2013 @ 4:00PM |

Benny Subianto, Master Networker With a Trustworthy Reputation

This story appears in the December 2, 2013 issue of Forbes Asia.

By Gloria Haraito (FORBES INDONESIA)

“My reason to become an entrepreneur is simple. I wanted to keep going to the office even at 71,” jokes “Benny” Subianto in the course of a rare interview at just that desired perch, a spacious suite overlooking south Jakarta.

He helped build Astra, now the country’s largest business group, from its earliest days. He was the president director of two of its largest companies, Astra Agro and United Tractors, over the course of 26 years. He has since started his own firms, managing many of them through his holding company, Persada Capital Investama. (And he is No. 37 on our list of Indonesia’s 50 Richest.)

But the outstanding characteristic of Subianto’s career has been his closeness with other tycoons who were to rise strikingly in Indonesia’s recently robust recovery from the troubled days after Asia’s 1997-98 financial crisis.

As a partner and investor in their ventures, he uses his mastery of networking and reputation for trustworthiness. His criterion for investments isn’t always profits, he says–sometimes he goes for what he calls “helping a friend” projects.

Whatever the circumstances, the man long known by his nickname–Subianto is his only formal name–is credited with keeping a cool head. “I have known Benny over 30 years, and I’ve never seen him get angry,” says Djojo Boentoro, president director of an affiliated palm oil firm, Dharma Satya Nusantara, who met him when they worked together at Astra.

It would be understandable if 2013 would have been cause for investment agitation. A decline in coal prices hit Subianto’s key stake, in Adaro Energy, whose stock price drop accounted for most of a $230 million drop in his wealth, knocking him off the billionaires roster. The commodity-based Indonesian economy has slowed after its recent brisk rise, as cycles in the country will come and go. Cool heads plug on.

One clue to Subianto’s approach is on a bookshelf in his office–a row of works about his inspiration, Warren Buffett. “I admire Buffett for his expertise in stock investing and his knowledge of compound interest, which makes him one of the richest men in the world. Unfortunately, I learned about these techniques late in life, while Buffett got started earlier,” he says, laughing.

Much as Buffett will invest in businesses but leave the founders in place (as long as they are performing), Subianto is happy to hold a minority stake when others are adept at boosting return.

Last year he enjoyed $26 million in dividends from some 17 different companies in which he has a stake–more than his total net worth back in 1998, when he figures it was a mere $20 million. (So he’s got good at compounding, obviously.) “He prefers to become an investor in an established company,” notes Johannes Suriadjaja, president director of property firm Surya Semesta Internusa, who did his first business deal with Subianto 21 years ago.

Subianto’s start came, appropriately enough, through a friendship. The son of a small-time sugar and rice trader, he got an engineering degree and followed his college pal Theodore Rachmat to then small Astra International.

He was a salesman for its heavy equipment division, and Astra in 1969 was on the cusp of fast growth, soon to become a distributor for Toyota, followed a few years later with distributorships for Honda and Xerox. Today Toyota is the bestselling brand in the country, and selling them is a core business for Astra, now controlled by Hong Kong’s Jardine Group.

Subianto graduated into management (he didn’t leave Astra until 2002), and in 1988 got a financial stake. Astra founder William Soeryadjaya, who is also Rachmat’s uncle, needed help in getting a loan. Subianto obliged, and in return got a 5% stake in Astra Agro. He sold it in 2004 for a modest gain.

The Adaro Energy investment, by contrast, would become a major score. Using one of his own companies, coal contractor Dianlia Setyamukti, as a vehicle. Subianto joined other investors, notably William’s son Edwin Soeryadjaya, to buy control of Adaro for $46 million in 2005. Today Adaro sports a market capitalization of about $2.5 billion (even after the drop from depressed coal prices), and Subianto has a 12.4% stake, easily his most valuable stake in a public company, and he also sits on its board.

Two other key holdings are in palm oil producer and rubber processor Triputra Agro Persada and crumb rubber producer Kirana Megatara, both leading companies of the Triputra Group. Subianto founded the Triputra Group with his pal Rachmat in 2002. Subianto serves as president commissioner of both and holds stakes that, combined, are worth $280 million (it shifts along with the price for crude palm oil and rubber). Rachmat’s stakes in Adaro, Triputra and other firms has made him worth $1.9 billion.

Subianto’s success in Indonesia’s cozy business culture doesn’t end there. Note the ties with Johannes Suriadjaja of Surya Semesta: That connection originated when Johannes’ father, Benyamin Suriadjaya, the brother of William Soeryadjaya, wanted to sell back his shares in the Astra Group.

In the negotiations Subianto represented Astra, Johannes his father. Johannes recalls how Benny treated him and his father fairly in the deal, and by 2008 he was glad to return the favor by offering him an 8% stake in Surya Semesta, today worth $30 million.

The company is now on a fast growth path, expanding into industrial parks and hotels. It has 1,000 rooms in four hotels and plans to add 4,000 rooms in the next five years. It also plans to more than double its existing land bank of 1,400 hectares.

Subianto says such opportunities are like catching a bus: “If a bus stops near you, you should jump inside it.”

 

 

 

 
Luisa Kroll, Forbes Staff

My beat: How folks make, keep and spend fortunes. 

Indonesia's revival encountered a speed bump as its economy grew by under 6% in the third quarter of 2013, its slowest pace in nearly four years. Hurt by sluggish demand for its exports and weak prices of commodities, such as coal, Southeast Asia's biggest economy was also hit by a plummeting rupiah (down 19% in the past year) and the central bank's consequent attempt to rein in inflation. Unfazed by the slowdown and weaker currency, Lippo Group Chairman Mochtar Riady, through his two sons--Stephen, who heads operations in Singapore, and James, who's in charge of Indonesia--pressed ahead with an ambitious expansion both at home and overseas. In restoring a fortune badly dented by the late-1990s financial crisis, he moved into the top ten of FORBES ASIA's list of Indonesia's 50 Richest for the first time. Riady lost a much-publicized battle to acquire control of Singapore firm to Thai billionaire Charoen Sirivadhanabhakdi, but snatched the U.S. Bank Tower in Los Angeles, the tallest building in California, for $368 million last March. The deal was inked by Singapore-listed property arm Overseas Union Enterprise (OUE). In July OUE raised $476 million in an IPO of its hospitality trust and plans to do a similar listing of its commercial portfolio. Lippo is also expanding into health care, retail and setting up a chain of cinemas, banking on rising demand from the middle class that remains Indonesia's mainstay. The Riadys are one of 18 Indonesian tycoons who have added to their fortunes this past year. The biggest dollar gainer was Anthoni Salim, another busy dealmaker who added $1.1 billion to his wealth and moved into the top three for the first time. He unseated Susilo Wonowidjojo, who fell on clove cigarette woes and was one of 21 who lost ground. Six people lost their billionaire status while three moved into the 10-figure club, bringing the total to 29, down from 32 a year ago. The Hartono brothers held on to the No. 1 rank for the fifth year in a row. For the first time FORBES ASIA tracked 50 richest in Indonesia, 10 more than last year, worth a combined $95 billion. Without the additions, Indonesia's wealthiest would have eked out a tiny 1.1% gain. The full list included three newcomers and seven names who'd fallen off in previous years. The richest new entrant is Jogi Hendra Atmadja, the head of the nation's largest food processor, Mayora Group, whose shares have soared in the past year.

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