Home News MIND ID Prepares US$500M to Acquire Vale, Moedak Appoints as CEO

MIND ID Prepares US$500M to Acquire Vale, Moedak Appoints as CEO

state own enterprises ministry appointed Orias Petroes Moedak as a new CEO of the holding mining to replace Budi Gunadi Sadikin - Photo by SOEs Ministry Office

JAKARTA (TheInsiderStories) – Indonesian miner, PT Indonesia Asahan Aluminium (MIND ID) prepared funds US$500 million to acquire 20 percent stake of PT Vale Indonesia Tbk (IDX: INCO). While, state own enterprises ministry appointed Orias Petroes Moedak as a new CEO of the holding mining to replace Budi Gunadi Sadikin.

The director Ogi Prastomiyono, said the acquisition planned is targeting to be completed in the middle of 2020. He adds, the company will use internal cash and from bank loans for the acquisition plans.

He said, the state mining holding company has secured loans from two Japanese banks, Sumitomo Mitsui Banking Corp., MUFJ Bank and local lender, PT Bank Mandiri Tbk (IDX: BMRI). He explained, there are several steps must be passed by the holding mining before completing the acquisition.

The first step is the initial agreement between Vale Indonesia, Vale Canada Limited (VCL), and Sumitomo Metal Mining (SMM). The next step is finalize the sales and purchase agreement, shareholders agreement and off taker agreement. He hope, the conditional sale and purchase agreement signing with INCO‘ shareholders in the middle of December 2019.

Previously, President Joko Widodo expressed his readiness to assist Vale Indonesia divestment after met Brazilian Vale SA president and CEO, Eduardo Bartolomeo, at the State Palace on Sept. 23. Beside discussing the divestment, Vale also expressed their commitment to build smelter for ferro-nickel and high pressure acid leaching process.

The miner had talked with potential investor from China to build Bahodopi smelter in Central Sulawesi with costs up to US$2 billion. The output will be 700,000 tons per annum from the new smelter.

“We expect the groundbreaking of the projects starting next year and it can be finished in three years,” vice president director INCO, Febriyani Eddy told media recently.

Inline with the smelter development, Vale also prepared the supporting mining with total costs of $300million. The company has pocketed exploration permit and now waiting for the exploitation permit and the contract extension for the project.

The issuer had announced to invest $5 billion in nickel projects with its partners in the coming years, including $2.5 billion in battery-grade nickel plant projects with Japan’ Sumitomo Metal Mining Co. Ltd and China’ Qingshan Holding Group.

Vale and Qingshan have teamed up to build a battery-grade nickel plant in Indonesia at a cost of $700million with an annual nickel production capacity of 50,000 tons. Construction of the plant began in January and is expected to be completed within 16 to 18 months.

On the appointment of Moedak, SOEs minister, Erick Thohir, hoped that he continues the unfinished targets in Sadikin’ era, especially related to downstream project. The new CEO was born in Kupang, East Nusa Tenggara, 52 years ago. Before hold the new position he was the vice president director of Freeport Indonesia and finance director in port operator, PT Pelabuhan Indonesia II.

Vale is an integrated nickel mining and processing company operating in the Sorowako Block, East Luwu Regency, South Sulawesi. The multinational company based in Brazil actually has a divestment obligation of 40 percent.

Written by Staff Editor, Email: theinsiderstories@gmail.com