Five companies eye Kideco?s stake

Five companies had expressed interest in acquiring shares of South Kalimantan based coal mining firm PT Kideco Jaya Agung which is scheduled to offer 37 percent stake to Indonesian owned entities this year, according a senior official from the ministry of energy and mineral resources.

?Among the five companies are coal mining contractor PT Pama Persada Nusantara and coal mining firm PT Gunung Bayan Pratama,? said Mahyudin Lubis, Director of Mineral and Coal Enterprises at the ministry of energy and mineral resources. Lubis did not mention the name of the remaining three companies.

Lubis said that Kideco is still waiting for confirmation whether or not East Kalimantan provincial administration and Pasir Regency administration are interested to acquire some stakes.

Lubis added that due diligence would be carried out soon.

In 2001, Kideco is scheduled to offer 37 percent of its shares to Indonesian owned business. In December 2001, the company and the government had agreed to value 100 percent of the company at US$ 415 million. Divestment offer for 2001 had ended March 2002,with the exception for East Kalimantan and Pasir administration.

Under Indonesian coal contract of work, foreign investment coal mining firm must gradually divest up to 51 percent of shares to Indonesian owned entity after 10 years of production. In 2002, Kideco is required to divest 44 percent of its shares.

If no deal were not reached for 37 percent share divestment, the company would then close the 2001 share offer and would begin negotiation with the government to decide new price for 44 percent share offer.

Kideco is one of Indonesia?s top coal producers, operating a coalmine in Pasir regency, East Kalimantan.The company, which is currently wholly owned by Sam Tan Co.Ltd of South Korea, plans to produce some 11.5 million tons of coal in 2002. (alex)