Headline / July 2019

Steady but Sure: Mayapada Group Eyes Business Expansion

Jonathan Tahir started his career at the Mayapada Group right after completing his studies in business administration, finance and marketing at the National University of Singapore in 2009. Speaking to GlobeAsia at his office in Mayapada Tower in Jakarta, the 32-year-old executive admitted that he was rather nervous when his father told him, at age 22, to join the family business. By Muhamad Al Azhari “In Chinese tradition, the sons must continue the family business. I told my dad I wanted to gain experience working overseas, but he demanded that I return immediately to join the business,” said Jonathan, the only son of Mayapada Group founder Dato’ Sri Tahir, a well-known businessman and philanthropist. “I was fresh from college; I had no experience, but my father trusted me with so much. I was quite nervous: what if I made mistakes; what if I caused the company to lose money?” said Jonathan, who joined subsidiary Bank Mayapada as an auditor. Tahir had built up the Mayapada Group independently, despite being a son-in-law of tycoon MochtarRiady, founder of the Lippo Group, one of Asia’s largest and most diversified conglomerates. The Mayapada Groupcurrently operates in five sectors: financial services, specialty retail, health care, property and media. It has three subsidiaries listed on the Indonesia Stock Exchange, and one listed in Singapore. Business Empire Jonathan’s father, who was born in Surabaya, East Java, in 1952, did not come from a wealthy family, and his father was a rickshaw driver. However, Tahir did manage to enroll in medical school to become a doctor, but had to abandon his dream when his father fell ill and could no longer support his studies. He had no choice but quit college and help his father in business. However, his fortunes started to change after receiving a scholarship from Nanyang Technological Institute (now Nanyang Technological University) in Singapore, which paved the way for him to obtain a bachelor’s degree. Tahir developed his small garment business into a financial services and specialty retail giant under the umbrella of the Mayapada Group, the name of which is synonymous with “universe” in the Sanskrit language. It was Mayapada Bank, a lender established in early 1990,that servedas the backbone of the group’s financial services business. Today, the mid-sized lender has more than 190 branches across Indonesia, with a focus on servicing commercial establishments and small and medium enterprises. In the specialty retail sector, the Mayapada Group, through PT Sona Topas Tourism Industry, is the local partner of Hong Kong-based luxury goods retailer DFS, a subsidiary of Moët Hennessy Louis Vuitton (LVMH). The Mayapada subsidiary, which has exclusive rights for DFS in Indonesia, went public in 1992. The company, which is the market leader in this niche industry, operates duty-free shops at Jakarta’s Soekarno-Hatta International Airport and Bali’s Ngurah Rai International Airport. Still part of its specialty retail business, the Mayapada Group is also the local partner of British retailer WHSmith, operating some bookstores in Indonesia. Mayapada also established Zurich Topas Life, a joint venture with the Switzerland-basedZurich Insurance Group, offering life insurance and general insurance products. The family further owns PT Sompo Insurance Indonesia, which offers non-life insurance products, such as fire and casualty insurance. The company was established through a merger between PT AsuransiNipponkoa Indonesia and PT Sompo Japan Insurance Indonesia. Nipponkoa and Sompo merged after their Japanese parents undertook a management integration, which saw the creation of the largest general insurance company in the East Asian country. Both NipponKua and Sompo have had a presence in Indonesia going back more than 30 years. The Mayapada Group also operates a vehicle financing company through PT TopasMultifinance, established in September 2002. In the late 2000s, the group turned its attention to the health careindustry with the acquisition of Honoris Hospital,situated in Modern Land, an exclusive residential area in Tangerang, Banten. The hospital was rebranded Mayapada Hospital, as the group joined hands with the Singapore-basedNational Healthcare Group, which manages first-rate hospitals, such as National University Hospital, Tan Tock Seng Hospital and the NHG-Johns Hopkins Singapore Institute, in the city-state. The group also owns and manages numerous landmark properties in Southeast Asia and Indonesia, including four office towers in the Jakarta central business district. It also owns Four Points by Sheraton, a four-star hotel in Jalan M.H. Thamrin, Central Jakarta, the four-star Fairfield by Marriott Surabaya, and Fairmont Sanur Beach Bali, a luxury resort in Indonesia’s most popular tourist destination. In addition to its properties in Indonesia, Mayapada also owns two office buildings in the Singapore central business district. In media, the Mayapada Group controls both print and pay-television services. It is the local partner of business-focused Forbes Magazine and Elle, a global fashion and lifestyle magazine. It also owns Mandarin-language daily Gou Ji Ri Bao (which translates to International Daily News), aimed at members of Indonesia’s Chinese-speaking business community. Mayapada owns My TV, a Jakarta-based pay-TV channel for women, in addition to a stake in Rajawali TV (RTV), which is controlled by Peter Sondakh’s Rajawali Group. Professionals in Key Roles Jonathan explained that the Tahir family prefers to appoint professionals in key positions at the Mayapada Group, although the family remains firmly in control behind the scenes, driving the agenda and designing broader strategies, in addition to determining the group’s vision and mission. Jonathan, who has extensive experience in various sectors, said he currently spends most of his time in the group’s hospital and property arms. “In the banking sector, it is hard to grow our business any bigger because it requires a lot of capital. There are state-owned lenders and a large private lender, Bank Central Asia, in that market. Mayapada is still a mid-size lender,” he said, adding that one of his sisters and their father are more actively involved in the banking arm’s operations. And since the family prefers to assign top positions to professionals, Jonathan serves as chairman of Mayapada Hospital and some other companies, including the Singapore listed entity engaged in property management. Health Care Business Expansion Jonathan preferred to emphasize the family’s health care business during the interview. “This is our 11th year [in the healthcare industry]. We are currently upgrading our three existing hospitals and undertaking development of five more,” said the avid basketball enthusiast, born on Feb. 26, 1987. He said the group has set aside Rp 2.5 trillion ($177 million) in capital expenditure for the development of the five new hospitals. “We are budgeting about Rp 500 billion per hospital. The budget includes funds for land acquisition,” Jonathan said. According to him, two of the new hospitals will be in Jakarta (Kuningan, South Jakarta,and East Jakarta), two in Surabaya and one in Bandung, West Java. Jonathan said each will have about 200 beds, except the one in Kuningan, which may only have 100 beds, as the building will be smaller. As co-chairman of the Tahir Foundation, a social organization focusing on providing underprivileged people with education and health care services,he took time to explain the origins of the group’s hospital business. He said they built their first hospital because his father often helped less fortunate Indonesians, especially children,receive treatment at some of the National Healthcare Group’s hospitals in Singapore. “Mr. Tahir is a graduate of the National University of Singapore. He often helped less fortunate Indonesian children to receive treatment in Singapore. One day,someone at NHG asked Mr. Tahir, why he does not build a hospital in Indonesia, as it would be a lot easier to help the children back home. He just laughed, and said he lacked experience,” Jonathan said, referring to his father’s story. This was what prompted the National Healthcare Groupto cooperate with the Mayapada Group. “Our first hospital was fully supported by them. Our motto was, ‘Patients First.’ That’s why we designed the building to incorporate that spirit. They helped us with our first hospital [in Banten] and the second in LebakBulus[South Jakarta],” Jonathan said. When asked how he plans to grow Mayapada Hospital, he said the family does not aim to have the largest, but wants to have the best. “Some say our hospital is very luxurious. Many say it feels like they are entering a hotel. Yes, we are targeting the middle-class and higher, but we also want to ensure that prices remain reasonable for the services we offer, Jonathan said. “Our tagline is,’Experience Better Care.’ We want this spirit to be present in all our hospitals,” he said. By offering international-standard services, the Mayapada Group expects to attract not only expatriates, but also Indonesiansfrom the middle class and up, seeking high-quality health care services without having to go abroad. “If we continue building patients’ trust, we hope fewer will go abroad,” he said. Family First He said running a family business is harder than meets the eye. “I always say, it’s not as easy as people may think. For example, if you are not in a family business, if you don’t like your boss, you can always resign or change jobs. In my case, I can’t. How can I say I want to resign?” Jonathan said. “It’s all about communication. I am quite fortunate that my father trusted me with so many things while I was still young. I see many family businesses where those in the next generation are already in their 40s or 50s, but the father remains in control. But whatever troubles or disagreements we may have when running the business, my dad always says family must come first,” he said. The most difficult challenge, Jonathan said, is to go beyond what his father has achieved. Being the son of such a prominent businessman is a tough challenge for Jonathan. Tahir was the first Indonesian to sign the Giving Pledge, a campaign by billionaires Bill Gates and Warren Buffett to encourage wealthy people to contribute most of their wealth to philanthropic causes. Known as one of the nation’s most generous donors, Tahir has a long list of philanthropic activities. He has channeled money into several educational and health care programs in Indonesia, donated $65 million to the Global Fund to Fight Aids, Tuberculosis and Malaria, and gave millions of dollars to support Syrian refugees in Jordan. In 2013, his Tahir Foundation and the Bill & Melinda Gates Foundation announced a partnership that saw them commit a total of $200 million over five years – $100 million from each – toward achieving the United Nations Millennium Development Goals. This saw his appointment as the UN Refugee Agency’s first eminent advocate for Asia in 2016. “My dad said philanthropy is about commitment, not about your mood. It is not like if you make profit today, then it is O.K. to donate, but when you make a loss, you don’t,” Jonathan said. He admitted that he will have to run much faster than his 67-year-old father if he wants to surpass his achievements. “He is very active. He is now doing his Ph.D. at GadjahMada University [in Yogyakarta]. Every year, my father and I always review what we had done and what we plan to do in the next year. It feels like the finish line [in the race against my father] is getting further and further,” he said with a laugh. Tahir is also known as a patriot. In October last year, he exchanged $93 million, plus an additional S$55 million ($40 million),into rupiah to help prop up the weakening local currency, which came under pressure after investors started dumping high-yielding, but riskier assets from emerging nations, including Indonesia, amid global uncertainty. He also called on other businessmen to follow his example. “For my dad, even though he is of Chinese descent, Indonesia is the country where he belongs. It is the land where he will be buried and see his children and grandchildren live. He started everything from zero, and for him, whatever he achieved is the blessing the country had given him. That’s why he always wants to give back what he has, as much as possible,” Jonathan said.