JAKARTA (TheInsiderStories) – Indonesian miner, PT Cita Mineral Investindo Tbk (IDX: CITA) its targeting raises Rp1.3 trillion (US$92.86 million) fresh funds from the rights issue. The company plans to release as much as 648.22 million new shares and set the offering price Rp2,022 a share.
The unit of Harita Group offered every 26 shareholders whose names are registered until Feb. 7, 2020, are entitled to get five shares and allows to convert it with one new shares. For those who do not exercise their rights has a dilution effect of 16.1 percent.
The miner will use the the proceeds to pay all principal long-term debt interest with ICBC, the subsidiary’ debt (PT Harita Prima Abadi Mineral) to a number of creditors and the remaining funds will be allocated for working capital.
PT Harita Jayaraya, as the main shareholder of Citra Mineral, said that it would not exercise its rights. The parent will divert the whole rights held to other shareholders, British-Swiss’ multinational mining company, Glencore International Investments Ltd.
Last year, Glencore, takes an 18 percent share of Cita Mineral worth Rp1.2 trillion, after its majority shareholder PT Harita Jayaraya completed the sale of 606.73 million shares on Dec, 18.
“On December 18, Harita Jayaraya as the controlling shareholder completed the sale of 606,732,282 shares of the company, representing 18 percent of all the company’s issued shares to Glencore,” CITA’ director Harry Kusuma Tanoto said in the disclosure of information released on Dec. 20.
The share sale, he went on, was carried out based on Harita Jayaraya‘ policy as the controlling shareholder of the company and it was convinced that there were no negative impacts affecting the company’s revenue and business continuity for the transaction.
“There are no adverse impacts on operational activities, law, financial condition or business continuity of the company,” Kusuma said.
On Dec. 18, the company’ shares were traded on the negotiated market with 606.73 million shares at a price of Rp2,076 per share. The transaction price of the company that uses the trademark “Harita Bauxite” is calculated as premium, or higher than the market price, or 15.33 percent above the price on the regular market at that time Rp1,800 per share.
As of September this year, the bauxite mining shareholders consisted of Harita Jayaraya (Harita Group) of 90.96 percent, PT Suryaputra Inti Mulia holds 6.37 percent, and the public of 2.67 percent.
The transaction marks the official release of the company’s shares to a new investor, Glencore, which was announced by the company last August. To release the shares, the company has held an extraordinary general meeting of shareholders at the end of September and received shareholder approval.