United Tractors to realize C. Kalimantan coal mine acquisition plan soon

Publicly listed heavy equipment producer and coal mining contractor PT United Tractors expects to realize its plan to take over a coal mining company in Central Kalimantan in September, this year.

?We will conduct a due diligence audit on the acquisition target in September, and we hope the acquisition deal could also be concluded in the month,? UT?s finance director Gideon Hasan told reporters following the company?s extra-ordinary shareholders meeting in Jakarta on Tuesday.

UT signed a conditional sales purchase agreement to take over a coal mining company in Central Kalimantan on July 9, this year. The agreement covers the amount of shares to be acquired and their prices.

Gidion, however, declined to unveil the details of the acquisition, including the name of the company. He said that the value of the takeover transaction would be lower than the US$115.57 million paid by UT when it bought coal mining company PT Tuah Turangga Agung?s 93.33 percent stake, early this year.

In January 2007, UT through its mining contractor subsidiary PT Pamapersada Nusantara acquired South Kalimantan coal miner PT Dasa Jasa Ekatama, which produced 3.56 million tons of coal in 2007.

In January 2008, UT acquired coal miner PT Tuah Turangga Agung (TTA) for US$115.6 million. The mine is expected to start production at 200,000 tons this year and ramp up the output to 1 million tons in 2009 and 3 million tons in 2010.

In the shareholders meeting, the company received a green light from the shareholders to go ahead with its plan to issue right shares. Under the plan, the company will issue 475.26 million new shares, and expects to raise fresh funds of about Rp 3.6 trillion (1US$=9,191) from the rights issue. (*)