Bumi Resources to buy back up to 10 percent of its shares

Publicly listed PT Bumi Resources Tbk will likely buy back up to 10 percent of its shares from the investing public in another business move following its announcement recently to divest its entire stakes in five coal mining companies, Bisnis Indonesia reported on Monday.

The company's financial advisor PT Danatama Makmur told the daily last week that Bumi Resources would soon submit a buy back proposal to the capital market supervisory agency Bapepam for approval.

Vicky Ganda Saputra, the corporate secretary of financial advisor PT Danatama, said that Bumi planned to buy back its shares at Rp 1,200 per share, or about 125 percent of the company's closing prices of Rp 960 last week.

He said that the company would hold an extra-ordinary shareholders meeting on May 17 to seek the shareholders' approval for its buy back and divestment plans. In the meeting, the company would also seek shareholders' approval to pay dividend of between Rp 100 and Rp 200 per share for 2005 book year.

According to Vicky, Bumi would buy back its shares within 18 months after the extra-ordinary shareholders meeting. "The company will spend about Rp 2.33 trillion from its retained earnings and proceeds from divestment to buy back the shares," he added.

Bumi announced last month that it had reached an agreement with a consortium led by a local company to sell its entire stake its mining companies inlcuding Kaltim Prima Coal (KPC), Arutmin Indonesia, IndoCoal Resources (Cayman) Ltd, PT IndoCoal Kalsel Resources and PT IndoCoal Kaltim Resources for US$3.2 billion. (*)