ARMS struggles to regain control of Berau

By Ruli Setiawan

LSE-listed mining firm Asia Resource Minerals Plc (ARMS) is struggling to regain control of its 84.7 percent subsidiary IDX-listed coal miner PT Berau Coal Energy Tbk as the latter?s new management team has been denied full access by the outgoing President Director of Berau.

The ?internal conflict? had led the Indonesia Stock Exchange to suspend trading in the shares of PT Berau since May 5.

ARMS said in a statement Tuesday that PT Berau's newly elected President Director, Iskak Wahyudi, President Commissioner, Mangantar Marpaung, and Commissioner, Melli Darsa, with the full support of the two continuing directors of PT Berau nominated by the company, Paul Fenby and Keith Downham, and ARMS, have continued their dialogue with the Indonesian Financial Services Authority (OJK) and the Indonesian Stock Exchange (IDX). ?These discussions have the purpose of eliminating any uncertainty or confusion regarding the regularity and outcome of the extraordinary general meeting of the members of PT Berau (EGMS) that was convened and held on 30 April 2015, and to confirm for all purposes full legal recognition of the same under Indonesian law,? the statement said.

ARMS explained that while the minutes of the EGMS have been issued by the notary, the company is not presently in a position to predict with certainty when the lodgement of the notary's minutes of the EGMS with the Indonesian Ministry of Law and Human Rights will take place, such lodgement being in the hands of the notary and not being under the company's control, ?but the company is doing all it reasonably can to facilitate prompt lodgement.?

?Notwithstanding the results of the EGMS, for the time being the former President Director, Amir Sambodo, who gave the company on 25 March 2015 his resignation in writing from his position as chief executive officer of the company and also from all other positions within the ARMS group, including PT Berau, purports to continue to remain in his position as President Director and is engaging in conduct that is wholly unsupported by the company and to the detriment of the ability of the company to maintain adequate supervision and control of the PT Berau Group,? ARMS said.

?In particular, the company notes that the company's Chief Financial Officer, Paul Fenby, and the company's Chief Mining Officer, Keith Downham, who both continue to sit on the Board of Directors of PT Berau, and PT Berau's new President Director, Iskak Wahyudi, and new President Commissioner, Mangantar Marpaung, are presently being denied access to the head office of PT Berau for the conduct of usual business and have only limited access to PT Berau's information technology and accounting systems, and only very limited visibility of current bank account information,? it added.

The company said it continues to take all reasonable steps to maintain and regain where possible control over the company's procedures, systems and controls in relation to PT Berau and the remainder of the ARMS Group that is controlled by PT Berau. ?The company retains a reasonable expectation of a prompt return to normalcy. In particular, the company believes that PT Berau will be in a position to remove Amir Sambodo from all Group premises and facilities once the notary's minutes of the EGMS have been lodged with Indonesian Ministry of Law and Human Rights, as referred to above.?

Editing by Reiner Simanjuntak