Perdana Karya Perkasa cancels acquisition agreement

IDX-listed PT Perdana Karya Perkasa Tbk (PKPK) has canceled an earlier agreement to acquire an East Kalimantan coal miner as it fails to obtain approval from the stock market regulator to raise the necessary funds via rights issue, reports said on Monday.

Kontan daily reported that PKPK officially cancelled on February 19 the conditional sales and purchase agreement to acquire RITS Ventures Ltd, which holds a 66.5 percent shares in coal miner PT Indowarna Bara.

PKPK Corporate Secretary Herry Priambodo told the paper that the agreement between the company and RITS has already passed the set deadline.

Indowarna holds a 5,000 ha coal concession in West Kutai, East Kalimantan, with coal resources estimated at 433 million tons, and with calorific value of 4,800-5,500 kcal/kg.

PKPK initially planned to launch rights issue, of which about 97 percent of the proceeds, or Rp 5.5 trillion would be used to acquire RITS.

But the company has failed to obtain the necessary approval from the Financial Sector Authority for the rights issue plan as the regulator is concerned with the huge dilution effect to public shareholders, which hold 41 percent shares in PKPK.

Herry said that after failing to acquire RITS, PKPK would continue seek for acquisition opportunity, IUP coal miner with smaller reserves. (*)