Antam places three nickel plants as debt collaterals

State owned general mining company PT Aneka Tambang Tbk (Antam) will surrender its three ferro nickel processing plants as collateral for the repayment of its debts worth US$360 million to be obtained from Germany?s IKB Hermes, Koran Tempo reported on Thursday.

"We will use FeNI I, II and III plants as debt collateral. In addition, we will also place our export earnings to guarantee the debt," company?s president director Dedy Aditya Sumanegara said in Jakarta on Wednesday.

Deddy said the disbursement of the credits, which would be used to finance the construction of third nickel refinery plant FeNI III was, however, still waited for the result of the feasibility study of the new plant which was now being conducted by PriceWaterhouseCoopers.

"After the feasibility study has been completed, the management will seek approval from shareholders," he was quoted as saying.

Dedy said that Bank Mandiri had also agreed to provide additional credits of about US$75 million to finance the construction of the new plant which would cost the company about US$380 million. "We will use our own funds if it is still needed," he added.

The tender for the construction of the new plant was in fact won by Japanese firm Mitsui, but the company later pulled out from the project after it failed to obtain financial support. The Japanese position was then replaced by German?s Tessag which had successfully obtained financial backup from IKB Hermes.

Dedy said Antam had also received approval from Bank Mandiri to give the general mining company of about US$125 million in loan to finance the project if, for certain reasons, the German bank cancelled its loan commitment. (*)