Antam cancels right issue plan to finance capex

Indonesia-listed mining firm PT Aneka Tambang (Antam) cancelled plans to sell new shares in a rights offer and may instead seek bank loans to fund capital expenditure (capex) of Rp 2.35 trillion (US$=Rp 9,200) this year, president director Alwin Syah Loebis said in hearing with House of Representatives (DPR) on Monday.

In April, Alwin said that the company might do rights issue as one of the options to raise funds for the expansion plans. ?But we can also raise bank loans as another option to obtain the funds for the project,? he added.

Antam needs at least US$230 million in fresh funds to finance expansion plans which will include, among others, the construction of a chemical grade alumina (CGA) plant in West Kalimantan

Besides the CGA project, Antam will also build a 2 x 75-MW coal-fired power plant in Pomalaa, South Sulawesi this year to meet its electricity needs. ?The construction of the power plant will cost about $300 million,? he said, adding that the company would need to raise at least $50 million from external sources to partly finance the power plant project.

Antam and its Chinese partner Hangzou Jinjiang Group also plan to develop smelter-grade alumina project in Mempawah, West Kalimantan.

Antam is also doing a feasibility study on and looking for partners for the development of a smelter in East Halmahera, North Maluku to process nickel ore from its mines there into ferronickel. The smelter is designed with a capacity of 27,000 tons Ni per year with a total investment of US$1.2 billion. (bernard)