UT plans to acquire more coal mines in five years

The country?s automotive giant PT Astra International Tbk plans to acquire at least six coal mines, each with proven reserves of at least 100 million tons, within the next five years, Bisnis Indonesia reported Friday

Astra?s senior vice president Arief Istanto said in Jakarta on Thursday that the coal mines would be acquired by its subsidiary heavy equipment producer and coal mining PT United Tractor Tbk (UT) which also has coal mining unit through PT Pamapersada Nusantara.

He said that the acquisition would be financed by proceeds obtained from the recent issuance of UT?s bonds and rights shares. ?If there is a shortage of funds, Astra is ready to inject additional cash for the acquisition,? he said.

He said that the five coal mines would not include another coal mine in Central Kalimantan which would be taken over by UT later 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 said on August 19.

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. (*)