Mining Holding Company to Be Established in Early 2007
\nMonday, 09 October, 2006 | 13:10 WIB<\/p>\n
TEMPO Interactive, Jakarta: The government a form the mining holding company (Indonesian Resources Company) in the first half of next year.<\/p>\n
Mahmuddin Yasin, Deputy Minister of State-Owned Enterprises (SOEs) in the Restructuring Division, said that the study on the mining holding company is finished and is waiting to be carried out.<\/p>\n
He recognized that the Department of SOEs was still discussing several options concerning the new holding company.<\/p>\n
For instance, whether the status of the company will be a public company or a private one.<\/p>\n
\u201cIf it is a public company, this means that its shares will be offered to the public in which the government still controls the majority of shares,\u201d he said last week in Jakarta.<\/p>\n
Three state-owned mining companies, he said, will later be subsidiaries of the holding company: PT Tambang Batubara Bukit Asam Tbk, PT Aneka Tambang Tbk and PT Timah.<\/p>\n
The study for forming the holding company has attracted market players.<\/p>\n
The reason is that the new company will organize 65 percent of the government's shares in the three said mining companies.<\/p>\n
This does not include share ownership at PT Freeport Indonesia of 9.36 percent and at PT Indonesia Asahan Aluminium (Inalum) with 41.13 percent.<\/p>\n
A Tempo source at a government office said that share transfers at Freeport Indonesia and Inalum were being studied.<\/p>\n
However, the government has also studied the transfer of mining authority to the holding company with a similar reason: giving additional value to the holding company.<\/p>\n
\u201cShould there not be any additional value, investors will be more comfortable in trading shares at other subsidiaries,\u201d he said.<\/p>\n
According to the anonymous source, the plan of selling shares of the mining holding company to public must also undergo further investigation.<\/p>\n
The reason is that the mining holding company will be very strong if the transfer of mining authority is carried out.<\/p>\n
\u201cIf the majority of shares are controlled by certain individuals, it will influence investment in mining in Indonesia,\u201d he said.<\/p>\n
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