Ares acquires MTL

By Ruli Setiawan

HKSE-listed Ares Asia Limited through its subsidiary, Ares Access Limited recently stated it has undergone negotiation with coal miners in Indonesia to establish its coal trading business, targeting to sell coal in China and other Asian countries.

The company has successfully anchored certain coal suppliers from Indonesia and coal buyers from China on a long term basis.

On 24 September 2012, Ares, entered into a conditional sale and purchase agreement regarding the proposed acquisition of 99.96% equity interests of PT Mutiara Tanjung Lestari (MTL), a subsidiary of PT Berau Coal Energy Tbk at the consideration of US$13.4 million.

"As part of the Acquisition, Ares Access shall provide funding to MTL to repay the outstanding amount due MTL to Berau upon completion of the agreement. But in any event the funding shall not exceed the sum of US$5.5 million," the company said.

On the same date of the Agreement, one share holder of MTL, Kasymir Zaldi, entered into an agreement for the purchase of 9,999 shares of MTL from Berau on 24 September 2012. The Zaldi agreement is expected to complete at or about the same time as the completion of the Agreement.

"As such, MTL will be owned as to approximately 99.96% by Ares Access and approximately. 0.04% by Zaldi upon completion of both agreements," it said.

MTL is engaged in the business of coal hauling and mining services in the area of Tanjung Redeb, Regency of Berau, East Kalimantan Province, Indonesia.

The sole customer of MTL is PT Berau Coal, which is operating a few coal mining sites in the area of Tanjung Redeb.

The Acquisition is expected to be completed before 31 December 2012.

Ares' coal trading business, on the other hand, has commenced in October 2012 starting with a monthly trading volume in the range of 50,000 tons to 180,000 tons.

In its recently released financial report, company general and administrative expenses were US$2.3 million or 20.6% of sales, an increase from US$0.6 million or 0.4% of sales reported for the last corresponding period.

"This increase was mainly due to a rise in employee benefits expenses as well as the legal and professional fees incurred for the proposed acquisition of a mining services company in Indonesia," the company said.

Editing by Er Audy Zandri