Newmont Nusa Tenggara to Go Public
Ivan Dasa Saputra
Shareholders of Newmont Nusa Tenggara have agreed to go public, but only after the company finalizes the divestment of a 7 percent stake in the company, a spokesman said on Wednesday.
NNT spokesman Ruby Purnomo said a general shareholders meeting agreed that the company would issue an Initial Public Offering.
“In line with the last shareholders meeting, the IPO plan has been agreed [to] by the majority of shareholders, but the implementation will only be done after the obligation to divest 7 percent of the 2010 shares is completed,” Ruby said.
Rudy also said the government has appointed the State Investment Center (PIP) to handle the IPO with the foreign shareholders of the company.
Coordinating Minister for the Economy Hatta Rajasa has been urging two major foreign mining subsidiaries, Freeport Indonesia and NNT, which is the local unit of US mining giant Newmont Mining, to go public.
Hatta said that in meetings with the management of the two companies, agreements had been reached regarding an IPO; but he also said that renegotiations on revenue sharing with the two companies had to be completed before an IPO could take place.
The government has been seeking higher revenues from long term mining contracts.
“We hope to complete the renegotiation this year because all sides want it,” Hatta said, adding a list of government desires, including requiring miners to return portions of land they’re not using to the state, that smelters be built, that local participation in mining be raised and, of course, the requirement for the IPO and a higher government share of royalties, or revenue from gross sales.
The 7 percent stake in NNT is valued at $246.8 million, the amount that the government and the miner agreed to in a deal last year.
NNT runs the country’s second-biggest copper and gold mine on Sumbawa island in West Nusa Tenggara (NTB) province — the district head of West Sumbawa expects the central government to give priority to the district in its attempt to acquire a 7 percent stake in NNT, after the central government was blocked last month from buying NTT’s 7 percent stake.
Under Newmont’s current contract of work, the gold and copper miner is required to divest 51 percent of its stake in several stages.