Indocement to sell 35% stake in Indominco Mandiri

The publicly-listed cement maker PT Indocement Tunggal Prakarsa is planning to sell its 35 percent ownership in East Kalimantan coal mining firm PT Indominco Mandiri in a bid to buy back debts, the Koran Tempo daily reported Tuesday.

The paper quoted Indocement senior manager for corporate planning and finance Christian Kartawidjaya as saying that the divestment is part of the company?s program to sell non-core assets to raise cash to finance the debt buy back plan.

He said that the divestment of the Indominco stake was expected to be completed this year. The company has appointed investment bank BNP Paribas as an adviser.

Indocement has an outstanding debt of around US$845 million as of April 22. Last year, creditors approved the company?s plan to buy back its debts.

Germany?s cement giant Heidelberger acquired a majority ownership in Indocement last year. Analysts said that the selling of non-core assets was also inline with Heidelberger?s demand as the foreign company had no expertise outside the cement industry.(*)