- Home
- Business Expansion
- Company Merger Indonesia
Company Merger Indonesia
- Share:
A company merger unites two or more businesses into a single, unified company. Indonesian company mergers are governed by the 2007 Limited Liability Company Law (Law No. 40 of 2007).
For any Indonesian company merger to proceed, it needs the green light from all participating shareholders and the Ministry of Law and Human Rights. Approval is also required from the Indonesian Competition Commission and other appropriate agencies.
Merger
- Definition: A merger is when two or more companies combine to form a new entity.
- Nature of Agreement: Typically involves mutual consent and collaboration between the merging companies.
- Company Identity: A new name and identity are created for the merged entity.
- Size and Power Dynamics: Companies involved are generally of similar size and financial strength.
- Stock Issuance: New stocks are issued to represent ownership in the newly formed entity.
- Decision-Making Process: Requires approval from both companies' boards and shareholders, fostering collaboration.
- Objectives: Aims for synergy, operational efficiency, and market expansion for both entities.
Acquisition
- Definition: An acquisition occurs when one company takes control of another by purchasing a majority of its shares.
- Nature of Agreement: Can be friendly or hostile; often initiated by the acquiring company without the target's consent.
- Company Identity: The acquired company usually loses its identity and operates under the acquiring company's name.
- Size and Power Dynamics: The acquiring company is usually larger and more financially robust than the target company.
- Stock Issuance: No new stocks are issued; the acquirer typically buys existing shares of the target company.
- Decision-Making Process: The acquiring company dictates terms, often leading to power imbalances and potential conflicts.
- Objectives: Focuses on gaining market share, technology, or resources rather than mutual growth.
Regulations Governing Company Mergers
- Law No 40 of 2007 on Limited Liability Companies (Company Law)
- Law No 25 of 2007 on Investment
- Law No 5 of 1999 on Prohibition of Monopoly and Unfair Business Competition
- Law No. 13 of 2003 on Manpower.
- Law No 8 of 1995 on the Capital Markets (Capital Markets Law)
- Government Regulation 27 of 1998 on Merger, Consolidation, and Acquisition of a Limited Liability Company
- Government Regulation 57 of 2010 on Mergers or Consolidations of Business Entities and Acquisitions of Company Shares Which May Result in Monopolistic Practices and/or Unfair Business Competition
- KPPU Law No 3 of 2019 on Assessment of Mergers or Consolidations or Acquisitions of Companies That May Result in the Occurrence of Monopolistic Practices and/or Unfair Business Competition
- OJK Regulation No. 9/POJK.04/2018 on Public Company Takeover
- OJK Regulation No. 74/POJK.04/2016 on Merger or Consolidation of a Public Company
Document Requirements
To merge with another company in Indonesia, the following documents must be prepared
- Identity and contact details of new Company Directors and Commissioner
- Identity and contact details of current Company Directors and Commissioner
- Identity and contact details of current Company Directors and Commissioner
- Scan a copy of the Deed of Establishment along with the SK
- Scan a copy of the latest Article of Association along with the SK
- Scan a Copy of the Tax Id, NIB, and Business License
- Copy of the Lease Agreement between the company and building management
Merge Your Company in Indonesia with LMI Consultancy
- Consult your inquiry with our professional consultant
- Submit necessary document
- Proceed with the payment
- Application process
- Receive the complete document
Other Popular Legal Licensing Services in Indonesia
Setup a Business in Indonesia with LMI Consultancy
Established in 2016, LMI Consultancy has been supporting countless individuals in understanding the intricacies of visas, business setup, tax & accounting, and property investment in Indonesia, providing a comprehensive and dependable service.Â
We take pride in being an ethical and innovative company that places a strong emphasis on exceptional customer service and strives to set a new standard in our industry, guaranteeing a smooth and encouraging experience for our clients.
FAQ
In Indonesia, how many different kinds of corporate mergers exist?
Indonesian companies merge in various ways, including:
- A merger by acquisition involves one company taking over another, inheriting its assets and debts, and leading to the acquired company’s dissolution.
- Consolidation merger unites two companies into a single, new organisation.
- An absorption merger occurs when one firm absorbs another, taking on its assets and debts, leading to the acquired firm’s dissolution.
What Indonesian regulations govern company mergers?
The legal framework for company mergers in Indonesia is established under Law No. 40 of 2007.
How much time is needed to complete a company merger in Indonesia?
Legally, mergers require a minimum of 30 days to finalise. Negotiations and due diligence, however, could extend the process.
Disclaimer : Our services in LMI Consultancy provide consulting services focused on ensuring client compliance with applicable immigration and legal regulations in Indonesia. We do not provide or facilitate the production of official government documents, nor do we offer any expedited or preferential access to government services.
Contact Us
Discover How We Can Help You
Transform your ambitions into achievements. Contact LMI Consultancy today and take the first step towards your business or life expansion across Asia!
- Jakarta HQ Office
Get Your Free Consultation
Connect with our consultants for expert advice.
- Seminyak Bali Office
Get Your Free Consultation
Connect with our consultants for expert advice.
- Sanur Bali Office
Get Your Free Consultation
Connect with our consultants for expert advice.
News & Resources
Get to Know the Latest Business & Visa Updates
Bali has firmly established itself as a destination for digital nomads, attracting remote workers, entrepreneurs, freelancers, and creative professionals from around the world. With its affordable cost of living, vibrant co-working culture, reliable internet infrastructure, and international community, the island continues to be one of Asia’s most attractive places to live and work remotely. However, […]
LMI Consultancy
July 29, 2026
Many taxpayers assume that once they have obtained a Tax Identification Number (Nomor Pokok Wajib Pajak/NPWP), it should remain active indefinitely. However, under Indonesia’s tax regulations, an active NPWP continues to carry tax rights and obligations, even if the holder no longer earns income or no longer qualifies as a taxpayer. To improve administrative certainty […]
LMI Consultancy
July 29, 2026
The Provincial Government of Bali has officially restricted new foreign direct investment (PMA) licences in 18 business sectors, marking one of the island’s most significant investment policy changes in recent years. The move aims to strengthen protections for local micro, small, and medium-sized enterprises (MSMEs), following concerns that some foreign investors had entered sectors traditionally […]
LMI Consultancy
July 24, 2026
Starting a business in Indonesia requires more than simply incorporating a company. Every business, regardless of its size or industry, is required to obtain a Business Registration Number in Indonesia, officially known as the Business Identification Number (Nomor Induk Berusaha/NIB). Issued through the Online Single Submission (OSS) system, the NIB serves as the primary business […]
LMI Consultancy
July 23, 2026
Indonesia House of Representatives approved legislation establishing the Indonesia International Financial Centre (Pusat Finansial Indonesia Internasional/PFII). The newly passed law introduces one of the country’s most ambitious tax incentive packages to date, offering substantial benefits for businesses, foreign financial professionals, overseas investors, and eligible Golden Visa holders operating within the designated financial centre. The legislation […]
LMI Consultancy
July 22, 2026
Indonesia has officially expanded its Visa-Free Visit (Bebas Visa Kunjungan/BVK) programme by adding six new countries and territories, making it easier for eligible foreign nationals to visit Indonesia for tourism and other permitted short-term activities. The new policy took effect on 9 July 2026 following the issuance of Minister of Immigration and Corrections Regulation No. […]
LMI Consultancy
July 15, 2026
