Govt assigns Antam to buy Newmont shares

The Indonesian government has appointed state owned mining company PT Aneka Tambang (Antam) to buy a 14 percent stake in PT Newmont Nusa Tenggara (NNT), the local unit of the US mining giant Newmont Mining Corp.

Speaking to reporters in Jakarta on Tuesday, Coordinating Minister for the Economy Hatta Radjasa said that Antam would represent the government to buy Newmont?s 14 percent stake that was supposed to be divested in 2008 and 2009 as part of the company?s mandatory divestment program.

The government and Newmont have recently agreed to fix the total value of NNT?s assets at US$3.52 billion. It means that the price of the 14 percent shares that have to be paid by Antam is $493.64 million.

Antam?s President Director Alwin Syah Loebis said that he had not been informed about the company?s appointment to buy Newmont?s shares. ?But we are ready if the government appoints us to do so,? he said.

He said that Antam would team up with PT Multi Daerah Bersaing, a consortium between PT Bakrie Capital Investment?s unit PT Multicapital and local governments, to buy the Newmont shares.

?We will be allocated about 2 percent of the shares to be divested by Newmont,? he said, adding that the company would use part of its own funds for the acquisition of Newmont shares.

Under its mining contract, the US based mining giant Newmont is obliged to sell 31 percent in NNT, which controls the Batu Hijau gold mine concession in West Nusa Tenggara, to the government or local companies from 2006 to 2010. Under the share divestment scheme, 3 percent should be divested in 2006, 7 percent each in 2007, 2008, 2009 and 2010.

PT Multi Daerah Bersaing has previously received the government?s approval to buy the 10 percent of Newmont shares that have to be divested in 2006 and 2007 for about $400 million. (*)