Antam?s executives oppose insurance guarantee requirement on loan

Some top executives of publicly listed firm PT Aneka Tambang Tbk (Antam) oppose the requirement to guarantee insurance of US$32 million for the $200 million in loan to be provided by German creditor IKB-Hermes, mining industry sources told Petromindo.com on Thursday.

The $200 million will be used for developing Antam?s FeNi III smelter in Pomalaa, South East Sulawesi, where two similar plants owned by the firm are already in operation.

?Antam?s executives opposing the requirement are trying hard to persuade their company to reconsider it. They even want that the requirement be dropped,? the sources said.

The sources said several Antam leaders had agreed on the insurance requirement because of their optimism that ferronickel prices on the world market will rise to a relatively high level in 2005.

Meanwhile, Antam?s corporate secretary Dohar Siregar denied that IKB-Hermes had required Antam to guarantee insurance for its loans saying that such requirements are not up to international practices.

Any loan normally includes insurance guarantee, Dohar added.

The government owns 60 percent of Antam while the remaining balance goes to public shareholders. (Godang)