This significant move positions MIND ID as the top shareholder in one of Indonesia's major nickel mining companies. The acquisition fulfills a crucial requirement for the extension of Vale Indonesia's mining permit beyond 2025, as foreign investors are mandated to transfer 51% of their combined stakes to local entities after a specified operational period.
Following the transaction's completion, MIND ID's ownership in Vale Indonesia will increase from 20% to 34%, solidifying its position as the largest shareholder. Vale Canada's stake will be reduced to 33.9%, while Sumitomo's will decrease to 11.5%. Approximately 20% of the company's shares are publicly traded.
The agreed value for each share was 3,050 rupiah ($0.1952), as stated by senior minister Luhut Pandjaitan. However, by Monday's market close, the share price had dipped 3.1% to 3,830 rupiah. Vale Canada anticipates receiving roughly $160 million in cash as part of the deal.
The government has committed to expedite the issuance of Vale's new mining permit within ten days of Monday's signing, providing certainty for the company's future operations. Under this permit, Vale Indonesia will have a ten-year operating window post-2025, with potential for extension.
Regarding the composition of the board of directors, discussions are ongoing, but initial agreements have been reached. MIND ID is slated to appoint the CEO, while Vale Canada will provide the COO. Vale remains steadfast in upholding its environmental, social, and governance standards for its Indonesian operations, according to Deshnee Naidoo, CEO of Vale Base Metals, the parent company of Vale Canada.
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