Growth Story
    Category: Special Features By : Gloria Haraito Read : 1669 Date : Tuesday, April 16, 2013 - 15:37:11

    Teddy Rachmat is a man with few regrets but one of them is not becoming an entrepreneur sooner. Having been a pioneer who helped build the largest business group in Indonesia, Astra International, also inspired him to become one. In 1998, he had the chance to buy Astra for $65 million during the Asia financial crisis, but never took the step. “Unfortunately, I did not buy it because I was thinking as an employee,” says Teddy, whose formal name is Theodore Permadi Rachmat. The company was eventually acquired by Hong Kong's Jardine group.

    That experience was part of the inspiration for him to become more entrepreneurial and start more of his own businesses, where he could have greater control over his destiny. As a result, Teddy is the owner of one of the biggest privately held business groups in the country, the Triputra group. He is also a shareholder or owner in many other major entities, such coal miner PT Adaro Energy. Now 69, Teddy could easily retire, but instead goes to the office every morning. “I'm here not to expand the group but to mentor the next generation,” says Teddy. In total, Teddy's companies and investments have given him an estimated net worth of $1.6 billion, making him the 17th wealthiest man in Indonesia.

    Triputra, which means three children, now employs 30,000 people and aims to have Rp 1.5 trillion profit on Rp 40 trillion revenues last year, up 45% from 2011 Rp 27.5 trillion. By 2017, Teddy would like Triputra to have Rp 85 trillion in revenues. To reach this target, Teddy allocates Rp 4 trillion as capital expenditure, partly used to plant 40,000 hectares of land. The group is divided broadly into four areas: agribusiness, manufacturing, mining, and trading and services. Many of his companies are among the largest companies in their fields.

    Teddy got started on his remarkable career immediately after he graduated with a degree in mechanical engineering from the Bandung Institute of Technology (ITB) in 1968. That same year he was offered a job as a salesman by his uncle William Soeryadjaya, the founder of Astra International, which he had started in 1957. Teddy became employee number 15 at Astra. In the early days, he drove to meetings on a scooter and often slept in the office. As Astra grew, Teddy's responsibilities grew along with it.

    Teddy then went on to help found in 1972 and then manage PT United Tractors (UT), the heavy equipment business under Astra. With $500,000 capital in 1960s, now UT's valuation has risen to $10 billion. In 1985, Teddy was appointed chief executive of the entire Astra group, a position he held until his retirement in 2005. Teddy also participated in developing Adira, a finance company established in 1990 by Teddy's father, Raphael Adi Rachmat. Through 1998 to 2002, Adira's outstanding loans grew 1,700%. Yet Teddy saw that the company was reaching its limits—to compete on a large scale it needed to be backed directly by a bank. So in 2004, Teddy sold Adira in two stages, selling 75% to PT Bank Danamon in 2004 for Rp 1.2 trillion, then selling the remainder in 2008 for Rp 1.8 trillion. “If we kept trying to do it alone, Adira would never been as big as it is today,” says Teddy.