Energy Minister: Vale Willing to Divest 11% Shares with Operational Control Rights
Translator
Editor
14 June 2023 11:58 WIB
TEMPO.CO, Jakarta - Indonesian Energy and Mineral Resources Minister Arifin Tasrif revealed the development of the government's efforts to complete the divestment of mining giant PT Vale Indonesia Tbk. to MIND ID, the holding company of state-owned enterprises (SOEs) engaged in the mining sector.
He said Vale Indonesia is willing to divest more than 11 percent of its shares as part of the requirements to extend its mining operation permit which will expire on December 28, 2025.
The ministry's Minerals and Coal Directorate General had discussed the divestment with the SOE Ministry, the Investment Ministry, and the Finance Ministry on May 4, 2023.
“Vale opens up opportunities to divest shares of more than 11 percent with operational control rights and financial consolidation,” Arifin said in a joint meeting with the House of Representatives (DPR) Commission VII at the Parliament Complex on Tuesday, June 13, 2023.
Meanwhile, MIND ID wants operational control and financial consolidation. Arif assessed that MIND ID will not gain benefit from only purchasing an additional 11 percent of the divested shares and even faces the potential to incur losses.
Thus, the share divestment process is still ongoing. MIND ID, he went on, also asks for government support to encourage negotiations through the momentum of permit extension into a special mining business permit. Nevertheless, he said Vale has not yet submitted a price offer for its divestment shares thus far.
Following Law No. 3 of 2020, Vale Indonesia is required to increase domestic ownership to a minimum of 51 percent to have its mining permit extended.
Vale has stated that the divestment process can start on January 31, 2023, and is suggested to make an offer to the government from March 2023.
Minister Arifin outlined that based on the monthly report on shareholder registration for June 2023, PT Vale Indonesia's shareholders consist of Vale Canada at 43.79 percent, MIND ID at 20 percent, Sumitomo Metal Mining at 15.03 percent, and the public at 20.49 percent.
RIANI SANUSI PUTRI
Editor's Choice: Bahlil Meets Jokowi to Talk Vale's US$4.5bn Smelter Project with Ford, Huayou
Click here to get the latest news updates from Tempo on Google News
