RATU to Acquire 20% Participating Interest in Madura Strait PSC

Jakarta, CNBC Indonesia — The issuer owned by Happy Hapsoro, PT Raharja Energi Cepu Tbk (RATU) will expand in upstream oil and gas through acquiring a Participating Interest in Madura Strait PSC. The corporate action has been approved by shareholders at an Extraordinary General Meeting of Shareholders (RUPSLB). In the RUPSLB, shareholders approved the plan to acquire 100% of SMS Development Limited by PT Raharja Energi Madura (PT REM), a company controlled by RATU. ‘Through this transaction, PT REM will indirectly obtain 20% Participating Interest in Madura Strait PSC, operated by Husky-CNOOC Madura Limited (HCML),’ the management wrote, quoted Friday (22/5/2026). This approval also covers the provision of a guarantee to the seller in respect of the acquisition, in line with the Material Transaction provisions under POJK No. 17/POJK.04/2020. Furthermore, shareholders also approved RATU’s plan to issue a corporate guarantee or cash deficit guarantee for the credit facilities obtained by PT REM from banks or financing institutions to fund the transaction. This approval forms part of the overall financing structure designed to support the completion of the transaction. ‘Shareholders’ approval of both items on the RUPSLB agenda is a very meaningful achievement. The acquisition of Participating Interest in Madura Strait PSC will broaden and strengthen the Company’s upstream oil and gas portfolio significantly,’ said Sumantri, President Director of PT Raharja Energi Cepu Tbk. Previously, management had stated that the acquisition would be carried out via signing a novation agreement and a Share Purchase Agreement. In the novation agreement, PT REM acts as the new lender taking over the rights and obligations of the old creditor, namely SMS Offshore Overseas Limited, in relation to the loan to SMS Development Limited. The novation value reaches US$59.2 million. ‘This loan was previously provided by SMS Offshore Overseas Limited to SMS Development Limited. The value becomes the price for transferring the loan paid by the new lender to the old lender,’ wrote RATU management in the disclosure to the Indonesia Stock Exchange (BEI). Payment is made by PT REM to the old creditor and once effective all rights and obligations under the loan agreement transfer to PT REM. The loan was previously non-interest bearing and economically categorised as quasi-equity because it was used to acquire 20% of HCML and to fund cash calls. In addition, the company plans to adjust the interest rate after obtaining RUPSLB approval with reference to arm’s length principles. A 5% per year interest rate is projected to generate interest expense of about US$2.96 million in SMSD, but eliminated in the consolidation report so as not to affect consolidated net profit. In addition to the novating of the loan, PT REM also signed a Share Purchase Agreement (PPJB) to acquire 100% of SMS Development Limited from SMS Offshore Overseas Limited. The main transaction value is recorded at US$62.51 million. It is stated that the company had previously paid an initial deposit of US$12.5 million on 25 December 2025. The transaction also includes a contingent payment scheme. SMS Development Limited could receive an additional US$16.5 million if the PSC extension is obtained, plus a US$3 million bonus if the PSC extension occurs before 30 June 2027. SMS Development Limited itself is an investment company holding shares in HCML, a company engaged in exploration and production of crude oil and natural gas in the Madura Strait under a PSC with SKK Migas. Thus, the total value of the planned transaction, including the acquisition plan, contingent payments and loan novation, is US$141,219,164. In the transaction, OCP Asia Fund IV and OCP Asia Fund V act as new lenders and also economically entitled to the transaction’s proceeds. The funds’ payment for the transfer of shares by PT REM to SMS Offshore Overseas Limited is essentially used to settle obligations to both funds. As part of the transaction mechanism, OCP Asia Fund IV and V will also issue a deed of release covering the release of certain obligations and release of share pledges. However, issuing these documents awaits fulfilment of several conditions precedent before closing the transaction. Additionally, the company disclosed a supplementary letter dated 26 December 2025 between the company and PT Petro Indo Pacific (PT PIP). The letter sets out the allocation of economic responsibility for PT REM’s obligations under the PPJB: the company bears 45% and PT PIP 55% of any claims arising from buyer obligations. Subsequently, a supplementary letter dated 17 March 2026 governs the allocation of responsibility for guarantees to creditors under the proposed financing for the acquisition. In that agreement, the company bears 51% of the liability and PT PIP 49%. The company notes a total maximum exposure from corporate guarantee and cash deficit guarantee is estimated at US$78.19 million. Nevertheless, economic exposure is considered mitigated by risk sharing with PT PIP and a measured risk profile. The company also regards the consolidated equity capacity of US$56.6 million as at the end of 2025 to be adequate to absorb potential exposure without disrupting the business.