Nusamba announces bid for Indocopper

JAKARTA (JP): PT Nusamba Mineral Industri, a subsidiary of the politically well-connected Nusamba Group, formally announced its bid yesterday to buy a majority stake in Indocopper Investama Corporation (IIC).

The company said it proposed to purchase all Bakrie & Brothers' 10,814,900 shares of IIC, which owns 9.36 percent of Freeport Indonesia.

According to Nusamba's notice published in the Republika daily yesterday, the company wants to buy the shares, which have a nominal value of Rp 1,000, for US$28.82 each.

The acquisition would be worth about $311 million.

Bakrie & Brothers said it would announce today whether it would sell its Indocopper shares.

According to reports, Bakrie & Brothers is under political pressure to sell its stake in Indocopper. But Bakrie Group's chairman, Aburizal Bakrie, and Bakrie & Brothers' president, Tanri Abeng, have denied this.

"There is no political pressure," Tanri told the Jakarta Post early this week.

Aburizal Bakrie said there had not been any pressure from the government to sell Bakrie's controlling stake in Indocopper, and any decision to sell would be based on business, not political, reasons.

He said Bakrie & Brothers had received a $15 million dividend in 1995 from its 51 percent stake in Indocopper. This was lower than expected.

Freeport Indonesia, 80 percent owned by U.S.-based Freeport McMoran Copper and Gold and 10 percent each by the Indonesian government and Indocopper, has been operating in Indonesia since 1973.

Indocopper and the Indonesian government now hold only 9.36 percent of Freeport Indonesia because they did not increase their equity capital when Freeport-McMoran raised the company's capital and issued new shares.

Bakrie bought a 10 percent stake in Freeport in January 1992 for $213 million. In December 1992, Bakrie sold 49 percent of its stake in Indocopper to Freeport-McMoran for $212 million; a windfall profit. This reduced Bakrie's stake in Indocopper to 51 percent. (09)