Bumi to go ahead with its merger plan

Despite the failed divestment of its subsidiaries to PT Borneo Lumbung Energi, JSX-listed PT Bumi Resources Tbk (Bumi) will go ahead with its plan to merge with PT Energi Mega Persada Tbk (EMP).

Bumi is set to ask an approval on the merger plan from the shareholders in the coming extraordinary general shareholders meeting to be held on September 19, 2006.

"Bumi remains certain that it will go ahead with its merger plan with EMP in accordance with procedures and time under the existing law and regulations," said Bumi's corporate secretary Geroad Jusuf in Jakarta Friday.

Geroad added that in fact, other potential investors, including those from foreign countries, were keen to buy shares in Bumi.

However, the amount of the transaction was not significant compared to the amount of the transaction conducted by Bumi and PT Borneo Lumbung Energi that has failed, he said.

Meanwhile, EMP hailed the merger plan even though Bumi's plan to divest its subsidiaries had failed.

EMP said that the merger would provide added-value for the company and the shareholders given that the move would allow for the diversification of portfolio on natural resources business and operation expansion.

"The failed divestment plan does not deter us from our plan to merge with Bumi. Merger plan is part of our strategic move to expand our business in the near future," said the company's director of business development Thomas Leo Soulsby.

Thomas also expressed his objection to the Jakarta Stock Exchange's (JSX) move to temporary suspend the share trading of Bumi since Friday.

However, he said, the failure in Bumi's plan to divest its subsidiaries did not affect EMP's performance because the company was by no means involved in the divestment transaction. (denny)