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The Business Acquisition Letter of Intent is a crucial preliminary document in Indonesian M&A practice, used when parties wish to formalize their initial understanding regarding a potential business acquisition while maintaining flexibility for detailed negotiations. This document serves as a roadmap for the transaction, incorporating key Indonesian legal requirements such as language provisions and corporate law compliance. It typically precedes the definitive purchase agreement and helps parties align their expectations while facilitating due diligence and regulatory preparations. The document must navigate Indonesian investment regulations, including foreign ownership restrictions where applicable, and sets the stage for obtaining necessary regulatory approvals. While predominantly non-binding, certain provisions like confidentiality and exclusivity are typically made binding to protect parties' interests during negotiations.

1. Parties: Identification of the parties involved in the proposed transaction, including full legal names, company registration numbers, and addresses

2. Background: Brief description of the parties and the context of the proposed transaction

3. Definitions: Key terms used throughout the letter of intent

4. Transaction Structure: Outline of the proposed acquisition structure, including the target business/assets and proposed ownership arrangement

5. Purchase Price: Indicative purchase price or price range and proposed payment terms

6. Due Diligence: Framework for conducting due diligence investigation and information access

7. Exclusivity: Terms of exclusive negotiation period and restrictions on engaging with other parties

8. Confidentiality: Obligations regarding confidential information exchange and publicity restrictions

9. Binding and Non-Binding Provisions: Clear statement of which provisions are legally binding and which are not

10. Costs and Expenses: Allocation of costs and expenses related to the transaction

11. Governing Law: Specification of Indonesian law as governing law and jurisdiction for disputes

12. Language: Statement regarding the language of the document (Indonesian/bilingual requirement)

13. Execution: Signature blocks and execution requirements