JAKARTA (TheInsiderStories) – Italian Enel SPA through its fully-owned subsidiary Enel Investment Holding B.V.closed a deal for the sale of its 10 percent stake in Indonesian coal producer PT Bayan Resources Tbk (IDX: BYAN) to Bayan’s controlling shareholder Dato’ Low Tuck Kwong, for a consideration of US$85 million.
“The disposal of our minority interest in Bayan perfectly fits with our asset rotation strategy as well as with our plans for a fully decarbonised generation mix by 2050,” said Francesco Starace, Enel Group CEO and General Manager said in a press statement on Oct. 10.
Enel purchased a 10 percent stake in Bayan in August 2008, during the Initial Public Offering at Indonesia Stock Exchange. The transaction is part of the 8 billion euro rolling asset rotation target provided for in Enel’s active portfolio management strategy.
The main shareholders of Bayan, which is a listed company, are Low Tuck Kwong, whose 51.6 percent interest is set to increase to 61.6 percent following the purchase of Enel’s stake, utility Korea Electric Power with 20.0 percent and other founding shareholders with about 9 percent.
Bayan is engaged in open cut mining of various coal qualities from mines located primarily in East and South Kalimantan and is also working through its subsidiaries in various business sectors, including port service management, coal loading, barging, contractor and heavy equipment rentals.
In Indonesia, Enel’s renewable arm Enel Green Power is currently exploring geothermal resources in a consortium established with local geothermal company PT Optima Nusantara Energi to develop the 55 megawatts (MW) Way Ratai geothermal power project in the Way Ratai area, in Lampung province.
The Enel Group also signed a Memorandum of Understanding in 2016 with state-owned power utility PT Perusahaan Listrik Negara to evaluate possible cooperation opportunities on sustainable generation projects in the country.
Recently, Bayan Resources reported is preparing to issue a maximum of $600 million worth Notes on the Singapore Exchange Securities Trading Limited. The proceeds from the issuance of Notes will be used for refinancing of the company’s debt as well as working capital and other corporate purposes.
This transaction plan is classified as a material transaction because it is equivalent to 318.9 percent of the total equity of the company and requires approval from the shareholders.
In the second quarter (2Q) of 2017, Bayan revenues rose 22 percent to $347.6 million from the same period of last year recorded at $221.7 million due to increased of production in Tabang, East Kalimantan and rising of coal price. Sales volume reached 8.4 million tons (MT) or jumped 55.56 percent compared to last year with average selling price $50.4 per MT, up 18 percent from 2Q 2016 at $41.2.
The company’s EBITDA rose double from $46.8 million in 2Q of 2016 to $101.6 million in 2Q of this year. As of June 30, 2017, committed and contracted sales of Bayan were 17.7 million ton with fixed price $45.68 per MT.
Bayan Resources was established by businessmen Bato Low Tuck Kwong, Jenny Quentero and Engki Wibowo.
Writing by Linda Silaen, Email: email@example.com