Perhapi calls for review of mining firms' merger plan<\/p>\n
JAKARTA (JP): The Association of Indonesian Mining
\nProfessionals (Perhapi) called on the government yesterday to
\nreconsider its plan to merge three state mining companies as part
\nof its privatization strategy.<\/p>\n
Perhapi's chairman Herman Afif Kusumo said the merger plan,
\nwhich was recently proposed by State Minister of the Empowerment
\nof State Enterprise Tanri Abeng, still contained some weaknesses.<\/p>\n
Herman said the state minister should make an intensive
\nassessment, involving the country's mining professionals, before
\nexecuting the merger to empower the state mining companies.<\/p>\n
Tanri earlier said his office was considering two strategies
\nregarding the divestment of government shares in publicly listed
\ntin miner PT Tambang Timah, publicly listed general mining firm
\nPT Aneka Tambang (Antam) and coal miner PT Bukit Asam.<\/p>\n
The first strategy is to merge the three with Tambang Timah as
\nthe holding company prior to their privatization.<\/p>\n
Another strategy is to privatize the three individually.<\/p>\n
No decision has been made, Tanri said.<\/p>\n
The three mining companies are among the 12 state firms the
\ngovernment plans to partially privatize this year to provide
\nUS$1.2 billion to state coffers as part of the agreement with the
\nInternational Monetary Fund (IMF).<\/p>\n
Herman said Timah, Antam and Bukit Asam had different mining
\ncharacteristics and applications of technology.<\/p>\n
As such, a merger among them would hardly create a synergy.
\nInstead, it could unfavorably affect the productivity and
\nprofitability of each company.<\/p>\n
Herman suggested that Bukit Asam be merged with its main
\nconsumer, the giant coal-fired power plant in Suralaya, West
\nJava, to establish an integrated power company.<\/p>\n
The Suralaya power plant is owned by the Pembangkitan Listrik
\nJawa Bali I (PJB I), a subsidiary of state electricity company
\nPLN.<\/p>\n
Bukit Asam currently sells 70 percent of its annual 12 million
\ntons of coal to the Suralaya power plant at discounted prices.<\/p>\n
Herman also attacked the assumption in Tanri's proposal that
\nTimah would be the best choice for the holding company,
\nindicating that Antam would be more suitable.<\/p>\n
He said Antam was bigger than Timah in terms of assets, with
\nthe former currently booking total assets of Rp 1.6 trillion
\n($114 million) against Timah's assets of Rp 1.15 trillion.<\/p>\n
Antam had a better future than Timah since the former was
\nactive in various minerals which still had prospects on the
\ninternational market, while tin, Timah's main commodity, had a
\ndeclining demand.<\/p>\n
\"Multicommodity is a new thing for Timah, while Antam has a
\nlong multicommodity corporate culture,\" Herman said.<\/p>\n
Antam produces ferronickel, gold, bauxite, iron sand and
\nsilver.<\/p>\n
Herman said if Tanri Abeng insisted on merging the three
\ncompanies to establish the Indonesian Mining Company (IMC), it
\nshould be done while maintaining the independence of the three
\ncompanies as strategic business units.<\/p>\n
\"The merger should be limited to the aspect of share-holding.
\nThe strategic business units -- the three state mining companies
\n-- should remain autonomous in implementing their managerial
\nstrategy in line with their technological skills and core
\ncompetence,\" Herman said.<\/p>\n
The holding company should focus on marketing, promotion and
\nloan procurement, as applied by the Malaysian Mining Corporation,
\nHerman said.<\/p>\n
Perhapi also called on the government to delay the
\nprivatization of state mining companies until the prices of all
\nminerals strengthened on the international market.<\/p>\n
\"The state mining companies' shares will not sell for a
\nmaximum price at present when the prices of minerals are down,\"
\nHerman said. (jsk)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/perhapi-calls-for-review-of-mining-firms-merger-plan-1447893297",
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