Freeport McMoran agrees to sell Indocopper stake to Indonesia

New Orleans-based gold and copper producer Freeport McMoran Copper and Gold Inc., the majority stakeholder of PT Freeport Indonesia, said that it is ready to sell the latter's shares in PT Indocopper Investama to Indonesian investors, the Koran Tempo newspaper reported in its Monday edition.

Freeport McMoran has a 100 percent stake in Indocopper. The U.S. firm has a 91 percent stake in PT Freeport (including 9.36 percent owned by Indocopper) and the remaining 9 percent is owned by the Indonesian government.

The U.S. mining giant has decided to sell Indocopper’s stake in PT Freeport in line with the government’s request to sell it to Indonesian companies. Earlier, the government has rejected the merger of Indocopper and Freeport McMoran.

Freeport McMoran’s vice president Communications William L. Collier III said his company has already received the government’s request on the Indocopper divestment through the Ministry of Energy and Mineral Resources.

“We agreed to consider to sell our stake in PT Indocopper Investama at a market price,” Collier III said.

He also said the government didn’t reject Freeport's proposal for a merger between PP Freeport and Indocopper, but only said that the Indocopper’s stake in PT Freeport must be sold to the national companies.

The government is also seeking higher dividend from the Freeport Indonesia for the years 2002 and 2003.

Deputy to the state minister for state enterprises Roes Aryawijaya said that the government’s demand is based on the fact that the financial position of the Freeport has improved a lot.

“The consideration is based on the fact that if the financial position of the Freeport is good, we will ask the company to increase the dividend,” Roes told the Koran Tempo and the Bisnis Indonesia in Jakarta on Wednesday. (*)