Newmont denies IPO plan
Thursday, July 24 2008 - 01:59 AM WIB
The company?s public relations manager Rubi W. Purnomo said Wednesday that the press reports that Newmont was preparing an IPO in order to be able to meet the divestment schedule were baseless.
He, however, said that if the government thought the IPO would solve the divestment problem, the company?s foreign shareholders might consider such an option.
The company?s spokesman Kasan Mulyono said earlier that the mining company, which operates a copper and gold mine in West Nusa Tenggara province, was studying the possibility of selling the shares through IPO in meeting the divestment requirement.
Chairman of the Investment Coordinating Board (BKPM), Muhammad Lutfi, however, opposed the plan, saying that selling the shares through IPO would be against Newmont?s contract.
He said that under the contract, the shares should be sold at a price approved by the government, not based on a market price. ?We therefore call on Newmont to cancel the IPO plan,? he added.
NNT, which obtained its contract of works to operate a copper and gold mine in Batu Hijau, West Nusa Tenggara in 1986, is required to divest up to 51 percent of its shares to the government or Indonesian companies by 2010. By the end of 2007, the company should have divested 10 percent of its shares as part of the mandatory divestment program.
However, none of the shares have been divested, prompting the government to file an international arbitration against the firm.
Both the government and Newmont have agreed to settle the problem through international arbitration. Both parties have appointed their respective judges for the arbitration, but no hearing has so far been made.
Currently, NNT?s shareholders are Newmont Mining Corp (45 percent), local company PT Pukuafu Indah (PI) (20 percent) and a consortium led by Japan's Sumitomo (35 percent). (*)