PT Indika Energy Tbk (INDY) released 100% share ownership in the coal mining company PT Multi Tambangjaya Utama (MUTU), PT Petrindo Jaya Kreasi Tbk (CUAN) for USD 218 million or equivalent to IDR 3.35 trillion. This step shows Indika's commitment to break away from dependence on the coal business and develop a green or sustainable business.
"The sale of share ownership in MUTU is part of our strategy to reduce exposure in the coal business and increase our non-coal investment portfolio. "Indika Energy targets to reach 50% of revenue from the non-coal sector by 2025," said Head of Corporate Communications Indika Energy Ricky Fernando to Investor Daily in Jakarta, Monday (25/9/2023).
He emphasized that Indika Energy will continue to review its business portfolio and focus on diversifying in the non-coal sector. "We will continue to develop our business in line with our Environmental, Social and Governance (ESG) commitments, including in the new and renewable energy sector and electric vehicles," said Ricky.
Indika Energy Corporate Secretary Adi Pramono, in a disclosure of information to the Indonesian Stock Exchange, revealed that on September 22 2023, Indika Energy, through PT Indika Indonesia Resources (IIR) and Indika Capital Investment Pte Ltd as sellers, had signed a conditional sale and purchase agreement (CSPA) with PT Petrindo Jaya Kreasi Tbk (CUAN), as buyer. The agreement is related to the planned sale of all shares owned by IIR and ICI in PT Multi Tambangjaya Utama (MUTU) to Petrindo Jaya Kreasi.
Based on the CSPA, the sellers intend to sell a total of 2,263,030,000 shares representing 100% of Indika Energy's indirect ownership in MUTU to Petrindo Jaya Kreasi (CUAN). And ICI intends to transfer all its rights and obligations based on the Marketing Services Agreement dated 25 June 2012 as amended by Amendment No. 1 for the Marketing Services Agreement dated January 5 2018 to Petrindo Jaya Kreasi (transfer of marketing rights together with the sale of shares).
Business Diversification
The agreed value for the proposed transaction is a total value of USD 218 million (around IDR 3.35 trillion). Adi Pramono stated that the completion of this transaction plan is subject to the fulfillment of several preliminary requirements as regulated in the CSPA, including approval from the Minister of Energy and Mineral Resources of the Republic of Indonesia.
"The company believes that the transaction plan is carried out in accordance with the company's diversification business strategy and to ensure that the company focuses on implementing sustainable business activities," said Adi Pramono.
After the transaction plan was completed, said Adi, MUTU would no longer be a subsidiary of Indika Energy and would not be consolidated in the company's financial statements. Indika Energy believes that the transaction plan is carried out in accordance with the company's diversification business strategy and to ensure that the company focuses on implementing sustainable business activities.
"The planned transaction will not have an impact on the company's operational activities, law, financial condition or business continuity," explained Adi Pramono.
MUTU is a thermal coal and bituminous metallurgical coal mining company located in Central Kalimantan, has a 3rd generation PKP2B (coal mining work contract agreement) with a concession area of 24,970 hectares. Since starting production in 2016, MUTU has shown extraordinary growth and achieved record profits in 2022.
Improve Performance
For Petrindo Jaya Kreasi, the acquisition of share ownership in MUTU is a fundamental component of the company's long-term strategy which aims to improve operational performance to be more efficient and effective, by integrating operations and strengthening the company's business portfolio in the fields of high-calorie thermal coal and metallurgical coal.
Petrindo Director Daniel J Laurente said that Petrindo's full ownership of MUTU would not only increase Petrindo's annual production, but also strengthen the company's operations in Central Kalimantan where most of Petrindo's assets are located.
"This confirms our position as a producer of high quality thermal coal, providing good efficiency, and providing superior efficiency and competitive advantages to our customers," he said.
Previously, also acquired 85% of the shares in PT Silika Salut Jaya (SSJ), which is a silica sand mineral mining company. The acquisition of SSJ was carried out through CUAN's subsidiary, namely PT Prima Mineral Investindo (PMI).
President Director and Secretary of Petrindo Jaya Kreasi (CUAN) Michael said that the takeover of the company's assets was important and PMI acquired it from shareholders who were not affiliated with the company. "After the transaction is carried out, PMI will become the new controlling shareholder in SSJ," said Michael.
SSJ is a mining company with a working area of 461.49 hectares in Kutai Kartanegara, East Kalimantan. Currently, SSJ is in the final process of obtaining approval from the Minister of Energy and Mineral Resources for the issuance of an Exploration Mining Business Permit (IUP Exploration) for Silica sand.
This, continued Michael, is in accordance with the initial aim of PMI being formed, namely to become a subsidiary of Petrindo Jaya Kreasi which acts as a holding company for companies engaged in mining other minerals such as silica sand or quartz.
Michael confirmed that the acquisition which will take place on September 11 2023 will have no impact on the company's activities. "These material facts have no impact on operational activities, law, or the financial condition or continuity of the company's business," added Michael.
Image source: Perseroan
Source: www.investor.id/Fokus Bisnis Hijau Indika Indy Jual Tambang Batu Bara Rp 33 Triliun
