The Indonesian government appointed state miner PT Indonesia Asahan Aluminium (Persero), or Inalum, to acquire a 20% stake in PT Vale Indonesia Tbk. for sale by the Vale SA unit in a bid to comply with the country's mining regulations, Reuters reported Oct. 7, citing Bambang Gatot Ariyono, the director general of coal and minerals.
Ariyono declined to divulge the deal's value.
Foreign-controlled miners are required to reduce their ownership to 49% or less within 10 years of production under the rules.
Vale Indonesia has already off-loaded 20% to shareholders in the country through the Indonesia Stock Exchange and needs to divest the other half by October.
Inalum expects to spend US$1.5 billion to take up the 20% stake, which it plans to source from own cash, bond issuance or bank loans, according to a previous report.
Vale owns a 59.27% stake in PT Vale Indonesia, and Sumitomo Metal Mining Co. Ltd. owns a 20.09% interest.
