JAKARTA (TheInsiderStories) - The plan of oil and gas producer PT Medco Energi International Tbk (IDX: MEDC) to launch rights issue has been delayed after the extraordinary meeting of the company failed to meet voting rights.
Previously, the company announced its plan to raise Rp6.6 trillion (US$485.30 million) through rights issue and bond issuance which will be used for expansion and debt repayment.
The company owned by tycoon Arifin Panigoro plans to offer 3 billion new shares or about 47.7 percent of the total paid up capital to raise Rp4.6 trillion ($338.24 million). At the same time, the firm is planning to issue bonds worth Rp2 trillion ($147.06 million).
Medco has appointed Mandiri Sekuritas as one of the bookrunners to assist the deal. The management explained that about $238 million of the funds raised, will be used for debt repayments, and $120 million for capital expenditure including assets acquisition.
Medco said the planned rights issue and bonds issue are pending on the approval of shareholders at the shareholders meeting on June 29, followed by submission of notification to the Financial Services Authority (OJK) on July 29.
Medco and other investors joint in a consortium, recently announced that the company mulls a plan to acquire 76 per cent stakes in gold miner PT Newmont Nusa Tenggara (NNT) in a deal that could reach $2 billion.
NNT is the owner and developer of Batu Hijau mining asset in Sumbawa island, West Nusa Tenggara province, the second largest copper and gold mine in Indonesia after Freeport McMoran‘s Grasberg asset.
US-based Newmont Mining owns 31.5 per cent of its Indonesian operations as of September last year, with the remaining stake held by Japanese trading house Sumitomo Corporation and Indonesia’s debt-ridden Bakrie Group.
Despite low oil price market, Medco is still expanding. Apart from eying NNT stakes, the company is also interested to acquire Indonesian geothermal assets owned by US giant oil and gas company Chevron.
Medco is also carrying on its existing projects including Block A gas project in Aceh. Recently, its unit PT Medco E&P Malaka (MedcoEnergi) signed of the $240 million Engineering Procurement and Construction (EPC) contract with the consortium of PT JGC Indonesia and PT Encona Inti Industri (JEC) for the development of the Block A gas project in Aceh.
The participating interest in this project is MedcoEnergi 41.67 percent, KrisEnergy 41.66 percent and Japex 16.67 percent.
Roberto Lorato, CEO of MedcoEnergi said the first gas of Block A will commence in the first quarter of 2018. Under the Gas Sales Agreement signed in January 2015 with Pertamina, MedcoEnergi will deliver 58 Billion British Thermal Units (BTU) per Day and 198 Trillion BTU over 13 years.
JEC is a consortium of PT JGC Indonesia and PT Encona Inti Industri. JGC has just completed the development of the Donggi Senoro LNG plant in Central Sulawesi, in 2015. (*)