Freeport?s share price deemed too expensive
Saturday, January 16 2016 - 06:03 AM WIB
Budi was quoted by Kontan as saying Saturday that PT Freeport has probably based the price offer for the shares on the copper and gold reserves at its mine in Papua lasting until 2041, thus resulting in the excessive price level.
?How come Freeport whose contract expires in 2021 based the (pricing) of the divestment (of the shares) on the copper and gold reserves until 2041,? he said.
Freeport on Wednesday officially offered the 10.64 percent shares it would divest this year to the government, valuing the entire 100 percent shares of the company at $16.2 billion, putting the value of the 10.64 percent shares at $1.7 billion. PT Freeport, the local unit of US-based Freeport McMoRan Copper & Gold Inc, made the share offer to meet its mandatory divestment program, under which it is required to divest a total of 30 percent stake to Indonesian investors, offering it first to the Indonesian central government, which currently already have a 9.36 percent stake in the company.
The government has 60 days to evaluate and respond to the PT Freeport offer.
Meanwhile, State Minister of National Development and Planning, Sofyan Djalil reiterated the government?s stance that it would not exercise its option to acquire the PT Freeport shares as no funds have been allocated.
As has been previously reported, a number of state-controlled companies including IDX-listed PT Aneka Tambang Tbk (Antam), PT Bukit Asam Tbk (PTBA), and PT Indonesia Asahan Alauminium (Inalum) have agreed to jointly acquire the shares. Some reports also said that state owned pension fund company PT Taspen, or tin giant PT Timah will take part in the group. State-controlled Bank Mandiri reportedly has been assigned to help raise the funding requirement for the acquisition of PT Freeport shares.(*)