UT hopes to decide whether or not to proceed with Berau sale by end of June

Publicly listed heavy equipment maker PT. United Tractors (UT) hopes it would come to a decision by the end of June whether or not to proceed with the sale of its 60 percent stake at East Kalimantan based coal-mining firm PT. Berau Coal.

?If we do not get favorable price for Berau, we may cancel the sale. There are several alternatives we are considering to settle the debt that will due at the end of this year. We may ask rescheduling from our creditors, we may proceed with right issue or to issue bond,? Tjandrawati Waas, UT?s investor relation head told Petromindo.Com Wednesday.

She said UT?s debt that will mature by the end of this year amounted to at least US$ 95 million.

Several bidder had earlier expressed interest to acquire Berau shares and had conducted due diligence, but apparently none of the bidders? offer satisfy the minimum price UT had set. UT is expected to get at least US$ 80 million from the sale of Berau to pay for the debt.

According to the industry source the bidders include Swiss? Glencore, Anglo-Australian BHP Billiton, Australia?s Strait Resources and state coal miner PT. Tambang Batubara Bukit Asam

Tjandrawati said several new bidders, local and international companies, had expressed interests, but she declined to disclose the companies? names.

She said UT had started approaching creditors about the possibility of debt rescheduling and thus far, she said, creditors? response was ?positive?.

?We have been a good debtor. We always pay our due in time. I?m optimistic if we can?t get good price for Berau and decided to cancel the sale, our creditor will seriously considering our request for debt rescheduling,? she said.

Berau Coal is operating in Berau regency, East Kalimantan, producing some 7 million tonnes of subituminous coal annually. The remaining 40 percent shares of Berau are held by Armadian Tri Tunggal (30 percent) and Japan trading powerhouse Nissho Iwai. (alex)