Asiamet Resources Limited (LON:ARS) said it has signed an agreement to sell its subsidiary Indokal, the owner of the BKM copper project in Indonesia, to private company PT Wasesa Indo Nusa (PT WIN) for US$163.4mln.

The AIM-listed firm said it will receive US$10mln of the sale price in cash from PT WIN once the sale and purchase agreement has been executed, with a further US$40mln to be paid one PT WIN completes an initial public offering (IPO) on the Indonesian Stock Exchange, planned for early 2021.

The rest of the acquisition price will be paid through a 22.5% shareholding in PT WIN following its listing.

READ: Asiamet expects BKM disposal agreement by year-end after cornavirus disruption

Asiamet said it will continue to manage the copper project for up to 12 months following PT WIN’s IPO through a management services contract, adding that following the IPO, PT WIN expects to have sufficient financial resources to enable a development pathway for the BKM project.

As part of the deal, PT WIN has also agreed to acquire Aeturnum Energy International Limited’s commodities trading business.

“Completion of this transaction with PT WIN and Aeternum will meet the three key objectives Asiamet was looking to achieve and in doing so is expected to unlock very significant value for all stakeholders. Firstly, and most importantly, it paves the way for the advancement of funding and development of the BKM copper project, secondly the Company retains a very meaningful stake and continues to provide significant input into the ongoing development and wider exploration upside of the highly prospective KSK CoW, and thirdly it strengthens the underlying balance sheet of the Company and enables Asiamet to continue growing value for its shareholders”, Asiamet executive chairman Tony Manini said in a statement.

“The outlook for copper remains strong as the transition to renewable energy and electric vehicles gathers momentum and drives increased demand, while mine supply simultaneously continues to be challenged. Recent strong upward revisions of copper price forecasts by various institutions support this thematic and provide a solid platform for the proposed IPO of PT WIN on the Indonesian stock exchange in early 2021”, he added.

Asiamet shares were 0.8% lower at 6p in early deals on Thursday.

Leave A Reply

Please enter your comment!
Please enter your name here