Finance Minister offers part of Newmont shares to local governments

The finance ministry has offered a part of PT Newmont Nusa Tenggara (PT NNT) shares it planned to buy to the local government in a bid to solve the dispute over the rights to buy the West Nusa Tenggara-based gold and copper mining company?s shares.

Finance Minister Agus Martowardojo said in Jakarta on Tuesday that 25 percent of the seven percent or about 1.75 percent of Newmont shares the finance ministry planned to purchase would be offered to three local administrations which represent the province and its two regencies West Sumbwa and Sumbawa.

He said that the shares should be directly bought by the local governments with their own financial resources, not through private companies. However, it had not been decided the percentage of shares to be given to each local government.

The finance ministry has signed agreement with Newmont to buy the remaining 7 percent stake the company should divest to meet the mandatory divestment program. However, the transaction could not immediately be settled because the local government insisted that they should buy the shares.

Definitive agreement was signed on Friday, May 6, 2011 between Newmont Corporation and the Finance Ministry for the sale and purchase of the final 7 percent divestiture stake in PTNNT, as required under the terms of PTNNT's contract of work with the Indonesian government.

The finance ministry designated state investment company Pusat Investasi Pemerintah (PPI) as the buyer for the final 7 percent interest by exercising a right of first refusal set out in the contract of work. (*)