Bumi Buys Fajar Bumi Sakti Parent To Acquire Coal Mines

The Jakarta Globe, January 7, 2009 

Local mining giant, PT Bumi Resources Tbk, Asia’s biggest exporter of power-station coal, agreed to purchase a 77 percent stake in the parent of PT Fajar Bumi Sakti for Rp 2.48 trillion ($224 million) to gain control of two mines. 

Bumi, the country’s biggest coal producer, would complete payment for the purchase of the stake in Leap Forward Finance Ltd. in two years, “provided Fajar Bumi Sakti reaches a certain production target,’’ the company said in a statement to the Indonesian Stock Exchange on Monday. 

This is the second acquisition announced by Bumi this week. The coal exporter said on Monday that it would buy an 80 percent stake in the parent of mining firm PT Darma Henwa Tbk for $222 million. 

Fajar Bumi Sakti has two coal concessions in East Kalimantan Province, with estimated reserves of 114 million metric tons, according to its Web site. 

Yufli Gunawan, president director of Fajar Bumi Sakti, is a former analyst at Bumi and its coal producing units, according to the Web site. 

Jakarta Globe calls seeking comment on the deal from Ari Hudaya, president director of Bumi, and Dileep Srivastava, investor relations head, were not returned. 

Both acquisitions this week should help Bumi increase its output and may reduce operating costs in mining units PT Kaltim Prima Coal in Sangatta, East Kalimantan, and PT Arutmin Indonesia in Senakin and Satui, South Kalimantan Province, by increasing efficiency. 

Dileep said on Dec.19 that Bumi revenue and production would increase about 10 percent this year. 

In July, Bumi also gained control of Herald Resources Ltd., an Australian mining company, after beating out a consortium led by another local mining company, PT Aneka Tambang Tbk, with a bid worth $549 million. Bumi now controls 51.34 percent of Herald.