Govt rejects divestment price set by KPC shareholders
Thursday, August 30 2001 - 01:53 AM WIB
The director general of geology and mineral resources at the Ministry of Energy and Mineral Resources, Wimpy S. Tjetjep, accused KPC shareholders - Rio Tinto of Australia and Beyond Petroleum of Britain - of having no interests in selling the stake by prolonging the negotiations over the divestment with the government.
He noted that only in a two-month period, from October to December 2000, the shareholders offered a much different prices for their stakes in KPC. In October, they still quoted KPC's 100 percent stake at %587 million, but then in December 2000, they increased it to $889 million.
"This shows that they have no good faith in completing the divestment of KPC stake," Wimpy told Koran Tempo.
He further said that in 1999, KPC shareholders offered 30 percent stake at the company at $175 million, but now, they wanted to sell their 51 percent stake at over $400 million.
"Consequently, the government becomes victimized," he said, adding that the government would likely appoint an independent valuation company to rate the price of KPC shares.
Meanwhile, Rio Tinto president Noke Kiroyan said the price they offered was a fair price as it was set by an independent international appraisal company Solomon Smith Barney.
Smith Barney valued the 100 percent stake of KPC at US$883 million. Based on the offer from KPC shareholders, the 51 percent stake at KPC would cost the local entity about $444 million. Meanwhile, the East Kalimantan administration, that has been eyeing the KPC stake for so long, has bargained it at a bit over $300 million.
Kiroyan said that he would welcome if the government wanted to appoint an independent appraisal company. But he suggested that such an appraisal company not come from Australia, Britain or Indonesia. (*)