Danantara Indonesia, the country's sovereign wealth fund, has formally offered to become a shareholder of the Indonesia Stock Exchange (IDX), the bourse said on Oct. 28, after its broker-owners approved bylaw changes that open ownership of the exchange to outside investors. Danantara's chief executive has said the fund could take 5% to 10%.

A stake would put a state fund among the owners of the exchange in a market that MSCI has threatened to cut from its emerging-market indexes over governance concerns. Indonesia's Finance Ministry has said demutualization, which separates ownership of the exchange from the brokerages that trade on it, is meant to strengthen governance, reduce conflicts of interest and make the country's capital market more competitive, KabarBursa reported.

IDX President Director Jeffrey Hendrik said Danantara's offer had come in and that due diligence was underway, according to Kumparan and Okezone. He declined to give the value of the bid or the size of the stake because the process was still running, Akurat reported. Danantara is the only formal bidder so far, Kumparan reported. The Finance Ministry and Bank Indonesia, which the law also names as eligible shareholders, have not applied, Hendrik said.

What Danantara Wants From the Exchange

Rosan Roeslani, Danantara's chief executive, said on Sept. 30 that the size was still open. “We are still discussing it, but it may be between 5% and 10%,” he said, according to InvestorTrust. He rejected reports that the fund was aiming for 40%, saying a holding of 30% to 40% could come from government-linked investors combined.

Those reports traced back to a presentation circulated to exchange shareholders on Sept. 9. It showed Danantara Investment Management, the fund's investment arm, taking 69 new shares in a rights issue, or 40.12% of the enlarged exchange, DealStreetAsia reported, citing local media. Member brokerages would have held 51.16% afterward, down from 87.38%, according to KabarBursa, which said Danantara called its study ongoing and undecided.

Each exchange share carries a nominal value of 7.5 billion rupiah, so 69 shares would cost about 517.5 billion rupiah at par, KabarBursa calculated. An appraisal by valuer KJPP Rengganis, Hamid dan Rekan put the market value of the whole exchange at about 16.41 trillion rupiah at the end of 2025, about 1.74 times its book equity, the outlet reported.

Chief Investment Officer Pandu Sjahrir said in August that new capital would pay for technology upgrades at the exchange and that Danantara would be a shareholder, not a regulator, KabarBursa reported. Djamal Attamimi, a managing director at Danantara Investment Management, said the fund's main interest was raising stock market capitalization relative to GDP, which he put at 50% to 60% in Indonesia against 100% to 120% in Malaysia and India.

How the Demutualization Works

The legal basis is Indonesia's financial sector law, known as P2SK, which names the Finance Ministry, Bank Indonesia and Danantara as parties that may hold exchange shares. The Financial Services Authority (OJK) set out the details in regulation POJK 13 of 2026, issued in September.

Under that rule, Indonesian individuals and companies may own exchange shares whether or not they are exchange members. Each holder is capped at 5%, directly or indirectly. A larger stake needs OJK's prior approval and must add value to the exchange, such as fresh capital, trading technology, connectivity or deeper markets, Kontan reported. No party may hold a majority, according to KabarBursa. Trading access stays limited to licensed exchange members, DealStreetAsia reported.

The process has moved more slowly than Danantara expected. Pandu said in late August that he hoped it would be finished within six to eight weeks, KabarBursa reported. On Oct. 8, Hasan Fawzi, OJK's chief executive for capital market, derivatives and carbon exchange supervision, said the exchange could not yet sell shares to non-members because some of its rules still reflected the old mutual structure, InvestorTrust reported. “The exchange also isn’t ready to do that,” he said, according to KabarBursa.

The Oct. 28 meeting dealt with that obstacle. Shareholders amended the articles of association, changing provisions on who may own shares and on dividend payments, Hendrik said, according to Akurat. He described the change as general rather than written for one or two institutions, Republika reported.

The vote does not yet make Danantara an owner. The exchange must hold another extraordinary meeting to approve new shares through a rights issue, Kumparan reported, and any stake above 5% needs OJK approval. Hendrik said the exchange hopes eventually to list its own shares, as bourses elsewhere have, but has set no timeline.

The MSCI Backdrop

The meeting came two weeks after MSCI proposed on Oct. 15 to move Indonesia from emerging to “standalone” status, citing opaque shareholding structures and suspected coordinated trading. The proposal set off the worst rout in Indonesian stocks since 1998, with the Jakarta Composite Index losing 11.57% on Oct. 16, The Jakarta Post reported. MSCI has said it will decide by June 30, 2027.

The idea of a state stake is older than the selloff. Rosan floated a stake of 15% to 30% or more on Feb. 1, after the benchmark fell nearly 7% in a week as critics pointed to limited transparency and alleged coordinated trading, Indonesia Business Post reported. He said then that ownership and membership of the bourse would be separated.

Hendrik has said ownership by state-linked parties will preserve the exchange's independence, detikFinance reported. OJK has said a large strategic holder must show the stake benefits the exchange, such as through ties with regional and global bourses, according to DealStreetAsia.

The next markers are a date for the second shareholders' meeting to approve the rights issue, and OJK's decision on how much of the exchange Danantara may own.