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Do not allow Freeport to sell shares through IPO, Lawmaker
(Kompas/Agus Susanto)Indonesia has to reject any efforts aimed at carrying out PT Freeport Indonesiaâs obligation to sell shares through an initial public offering (IPO), said Commission VII member from the National Democratic Party Kurtubi Umar
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(Kompas/Agus Susanto) (Kompas/Agus Susanto)
(Kompas/Agus Susanto)
Indonesia has to reject any efforts aimed at carrying out PT Freeport Indonesia's obligation to sell shares through an initial public offering (IPO), said Commission VII member from the National Democratic Party Kurtubi Umar.
He rejected Sudirman Said's opinion about Freeport's possible IPO to implement the divestment obligation. The Finance Minister was also reportedly supporting the IPO option, in agreement with Indonesia Stock Exchange's (IDX) CEO.
"The objectives of the mandatory divestment would fail if it was done through an IPO. In my opinion, the state must buy the shares through a state-owned enterprise [SOE]," he said as quoted by kompas.com on Monday in Jakarta.
The State Owned Enterprise (SOE) Minister Rini Soemarno had asked PT Aneka Tambang Tbk and PT Inalum to act on behalf of the government to purchase the divested 10 percent of shares from Freeport Indonesia.
Antam is Indonesia's SOE operating in gold mining and gold processing in Indonesia while Inalum is a metal producer SOE that is now eyeing the construction of a new mine.
Through an IPO, Kurtubi said, the state would not gain any real benefit from the divestment as Freeport might buy back its floating shares'after the IPO was conducted'through foreign special purpose vehicles (SPV).
According to the law, Freeport has to divest 10.64 percent of its shares to the government, increasing Indonesia's stake in the giant copper and gold miner to 20 percent, from the preliminary ownership of 9.46 percent.
By 2019, Freeport--the subsidiary of the US' giant miner Freeport McMoran Inc.--has to sell 30 percent of its shares to Indonesia. (ags/dan)(++++)
