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Freeport Indonesia should divest shares through IPO: Finance Minister
(Antara)PT Freeport Indonesiaâs share divestment should be conducted through an initial public offering (IPO) in Indonesia's capital market as the giant gold and copper miner has listed shares in the US market, Finance Minister Bambang Brodjonegoro said
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(Antara) (Antara)
(Antara)
PT Freeport Indonesia's share divestment should be conducted through an initial public offering (IPO) in Indonesia's capital market as the giant gold and copper miner has listed shares in the US market, Finance Minister Bambang Brodjonegoro said.
'I prefer to have it [Freeport Indonesia's share] listed in the stock market, to strengthen the market penetration, so that we have a stronger capital market,' Bambang said, as quoted by kompas.com on Thursday night.
By having Freeport's share in the Indonesia Stock Exchange (IDX), Bambang claimed, market volatility can be reduced, as Freeport's share would be added to the blue chip stocks.
It is normal and even an obligation, according to Bambang, for natural resource-based companies to list shares in the bourse. 'How can Freeport only have their shares listed in the US while the gold and the copper they extract is here? It's unfair.'
Bambang claimed to have talked with the Energy and Natural Resources Minister Sudirman Said on this issue. If the divestment is finally decided through an IPO, then the government will have to revise Government Regulation (PP) 77/2014.
'I have talked to the Energy and Natural Resources Minister. Yes, we still have to find a way to have them enter the capital market,' Bambang explained.
Under government regulation (PP) No.77/2014 on mineral and coal-mining business activities, Freeport must divest 10.64 percent of its shares to the government by Oct. 14. After accepting the offer, the government has 90 days to negotiate with Freeport.
Freeport Indonesia, a subsidiary of US-based giant Freeport McMoRan Inc., intends to meet the government's requirement that it divests 30 percent of its shares to Indonesian parties. The share divestment is part of a deal between the company and the government as they re-negotiate Freeport's contract of work (CoW) as mandated by the 2009 Mining Law.
Freeport Indonesia is currently 90.64 percent owned by Freeport McMoran and 9.36 percent owned by the Indonesian government. To meet the government's requirement, the company must offer another 20.64 percent of its shares to Indonesian shareholders. According to the current schedule, Freeport Indonesia must divest a further 10.64 percent of its shares in October. (ags/dan)(++++)
