East Kalimantan to file legal suit against Kideco shareholder
Wednesday, April 21 2004 - 02:14 AM WIB
“The agreement is not legal. According to Coal Contract of Work (CCoW), the government should be the first party to be offered the shares (of Kideco),” East Kalimantan provincial secretary Syaiful Teteng said Tuesday adding that East Kalimantan province is part of the government.
Syaiful, however, did not say when the province will made the law suit and at which court.
Under the CCoW, Kideco is required to gradually divest up to 51 percent of its shares to Indonesian owned companies after 10 years of commercial production. Kideco earlier managed to sell 10 percent shares to two Indonesian companies namely PT Sumber Mitra Jaya and PT Muji Inti Utama, which got 5 percent each.
Indika signed a deal on April 08, 2004 to buy 41 percent shares in Kideco. Following the deal, Samtan remains a majority shareholder in Kideco with a 49 percent shares.
East Kalimantan province, together with Pasir regency administration, has previously filled a lawsuit against the same parties over the sale of 10 percent shares in Kideco to PT Sumber Mitra Jaya and PT Muji Inti Utama.
They demanded the firm to compensate them for the selling of the 10 percent shares, arguing that Kideco should have offered the shares to them. Pasir administration demanded an East Kalimantan court to order the company to pay compensation in excess of US$300 million, and insisted that the court annul the transaction. Kideco shareholders refused to meet their demand.
The Balikpapan court judges, however, turned down their suit and asked them to report their case to the South Jakarta district court because Kideco is domiciled in the area.
Syaiful said Tuesday the province was also planning to continue the case.
Saiful added that East Kalimantan province is capable to buy 51 percent shares in Kideco on the price agreed by the government and Kideco.
Earlier, the government and Kideco agreed to value the latter’s 100 percent shares at US$365 million. (arry)