Aneka Tambang to float shares after 1997 election

Aneka Tambang to float shares after 1997 election

JAKARTA (JP): State-owned mining company PT Aneka Tambang has
announced that it would float shares on the local stock exchanges
after the general election next year to finance its expansion
programs.

"We are now preparing to go public next year," the company's
president, Darmoko Slamet, said at a public presentation
yesterday.

He said his company had not yet selected lead underwriters for
the initial public share issue, saying that the company would
soon conduct a "beauty contest" to choose its underwriters. The
underwriters are to be chosen in December.

When asked on the size of the first share issue, Darmoko would
not disclose any figures, saying that it totally depended on the
government, the company's shareholder.

"It might be similar with (state-owned tin mining firm) PT
Tambang Timah," Darmoko told journalists.

Tambang Timah floated 25 percent of its shares on the London
Stock Exchange and 10 percent on the Jakarta and Surabaya stock
exchanges.

Unlike Tambang Timah, Darmoko said, Aneka Tambang would only
list its shares on the local stock exchanges because the
government wanted to reinvigorate the local market.

He explained that some of the proceeds from the planned share
issue would go to the government and some would be used to
finance the company's expansion projects.

The company plans to double the capacity of its ferronickel
processing plant in Pomalaa, Southeast Sulawesi, and its gold
processing plant in Pongkor, West Java.

The Pomalaa expansion, called Pomalaa III, is to increase
Pomalaa's total ferronickel output to some 21,000 tons per annum
from its current output of 11,000 tons.

The company's financial director, Ki Agus Umar Tochfa, said
the Pomalaa project would require an investment over US$200
million, excluding the cost of building a 95 megawatt hydro power
plant to support the project. The power plant would cost about
$200 million.

"We will form a joint venture with a number of electricity
firms, including state-owned PT PLN, to construct the power
plant. We will take a minimum stake in the venture, not more than
20 percent," Darmoko said.

The Pongkor expansion project is to raise the Pongkor mine's
annual production from 1.8 tons of gold and two tons of silver to
five tons of gold and 10 tons of silver. The project requires a
Rp 90 billion (US$38.2 million) investment.

Darmoko said the company planned to increase its gold
production to reduce its dependency on nickel and ferronickel,
which have been the lifeblood of the company.

Nickel and ferronickel make up 74 percent of the company's
output; precious metals -- mainly gold and silver -- make up 16
percent and industrial minerals 10 percent.

"That's not favorable for us... considering the volatility of
nickel prices on the world market," Darmoko said.

By the year 2000, he said, nickel and ferronickel would only
account for 50 percent of the company's total production
portfolio, while precious metals would increase to 30 percent and
industrial minerals to 10 percent.

The company exports 80 percent of its output: its nickel ore
mainly to Japan and Australia; its ferronickel to India, South
Korea, Taiwan and a number of European countries; and its bauxite
to China, Japan and the United States.

The company's after-tax profits over the last three years have
been increasing, from Rp 10 billion in 1993 to Rp 21.5 billion in
1994 and to Rp 44.2 billion last year.

The company's total assets were worth Rp 634.04 billion last
year, decreasing from Rp 672.2 billion at the end of 1994. At the
end of 1993 its total assets were worth Rp 530.1 billion. (rid)