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Analysis: Inalum to focus on aluminum smelting after MIND ID spin-off
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PRINTING ALUMINUM Bars: Some Inalum employees are preparing aluminum bars after printing at the factory. PT Inalum can produce 225,000 tons of aluminum bars every year. (JP/Apriadi Gunawan)
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tate-owned aluminum producer PT Indonesia Asahan Aluminium (Inalum) is now free from its duty in strategic planning as a mining holding company and can finally focus on its aluminum operations. President Joko “Jokowi” Widodo has been eager to develop the country’s downstreaming industry by rolling out ore export bans, with washed bauxite export ban slated to start in June 2023, but stalled aluminum smelter development has deterred the plan.
On Nov. 27 2017, Inalum was declared a state-owned mining holding company and given the Indonesian government’s controlling shares in metals producer PT Aneka Tambang (ANTM), coal miner PT Bukit Asam (PTBA), tin miner PT Timah (TINS), and gold and copper miner PT Freeport Indonesia (PTFI). The shares transfer was carried out to establish a mining holding company that would also take over divested PTFI shares.
Then on Aug. 17, 2019, Inalum introduced a new entity called Mining Industry Indonesia (MIND ID) to distinguish its functions as a holding company and its aluminum smelting operations. Finally, at a general shareholders meeting (RUPS) on March 21, 2023, MIND ID split off from Inalum as an entirely separate entity named PT Mineral Industri Indonesia to focus on strategic holdings while Inalum focused on its aluminum business.
President Jokowi signed two government regulations (PP) to formalize the restructuring: PP No. 45/2022 on the government reclaiming its shares in ANTM, PTBA, TINS, and PTFI from Inalum, and PP No. 46/2022 on state capital injection into MIND ID by transferring the government’s reclaimed shares in ANTM, PTBA, TINS, PTFI and Inalum.
Inalum is now a subsidiary of MIND ID on the same level with ANTM, PTBA, TINS, PTFI and PT Vale Indonesia (INCO). It focuses on developing the national aluminum industry as well as expanding its business, raising business capital and providing sustainable benefits to all stakeholders.
Meanwhile, as a strategic holding company, MIND ID is focusing on increasing the effectiveness of its strategic activities, its efficiency, increasing the added value of its subsidiaries, managing risk and monitoring its subsidiaries’ operations.
MIND ID corporate secretary Heri Yusuf says the transformation will help strengthen the company’s governance toward more effective and efficient management of its subsidiaries and investment planning to create greater added value for the group, thereby maximizing its contribution to all stakeholders.
