BHP offers its stake at Arutmin to Bakrie at US$140m

BHP Biliton of Australia is very likely to sell its 80 percent stake at coal mining company PT Arutmin Indonesia to the Bakrie Group following the signing of sales and purchase agreement (SPA) between the two parties on August 31, 2001, Koran Tempo daily reported on Thursday.

Quoting a report at Business Times, Koran Tempo wrote that with the signing of the agreement, Bakrie and BHP were now finalizing the sale process of the stake worth US$140 million.

A BHP executive, Andrew Wilson, confirmed that his company was negotiating with Bakrie over Arutmin stake, but he refused to go into details of negotiations.

"We were asked by the Indonesian government to conduct talks with Bakrie, and we have conducted several meetings with them. I also do not deny that Bakrie is interested in buying the 80 percent stake in Arutmin," he said.

PT Bakrie Brothers, which used to own 20 percent stake at Arutmin, has transferred the stake to its creditors through a special purpose vehicle company, named PT Ekayasa Yasakarya Indonesia, as part of Bakrie Brothers' debt restructuring program.

According to Business Times report, in the sales and purchase agreement signed by BHP chief development officer Billiton Jhon Smith, addressed to Bakrie Brothers managing director and chief operating officer Nalin Rathodm BHP is willing to negotiate the same of the 80 percent stake at Arutmin worth $140 million to settle debt.

Smith gave Bakrie until Sept. 30 to answer.

Responding to Smith's letter, Rathod said in his letter, dated Sept. 4: "We agree, if the development is tangible, and there is a substantial solution, so that in a few days, the two parties could flexibly complete the transaction."

Meanwhile, Bakrie Brothers corporate communications manager Lalu Mara Satriawangsa said the talks between Bakrie and BHP were just normal as Bakrie was BHP's only partner in Indonesia.

Mara also said that Bakrie Brothers had no intention or plan to buy the 80 percent stake at Arutmin from BHP.

Mara, nevertheless, said that if there was talks between BHP executives and Rathod, Rathod would not represent Bakrie Brothers, but may represent the Bakrie Group in the general, as Rathod was no more a director at Bakrie Brothers.

"Nalin Rathod is not anymore one of Bakrie Brothers' directors. He has resigned. The fact that he still helps Aburizal Bakrie, that constitute as his loyalty to the Bakrie Family," Mara said. (*)