Govt investment firm sets aside Rp2 trillion to buy Inalum

Government investment arm Pusat Investasi Pemerintah (PIP) sets aside Rp2 trillion to purchase shares of PT Indonesia Asahan Aluminium (Inalum) being held by a Japanese firm.

Currently, the government holds 41.13 percent shares in Inalum and the remaining 58.87 percent is held by the Japanese company.

The total funds needed to buy 58.8 percent Inalum shares is estimated to reach around US$700 million or Rp6.3 trillion, Saritaon Siregar, the head of PIP said.

Currently, Inalum is operated by a Japanese company Nippon Asahan Aluminium (NAA). Its contract to operate the company will expire on 1 November, 2013.

The Japanese firm has sought to extend its contract to operate the company, however, the government insisted that it will not extend NAA?s contract.

Inalum, a joint venture between the Indonesian government and Nippon Asahan Aluminium established in July 1975, is one of the largest aluminum ingot smelters in Indonesia, .

The government is currently undertaking audit before purchasing NAA?s 58.8 percent shares in Inalum. (*)