- Indonesia has now officially taken ownership of 51% of the total shares in PT Freeport Indonesia (“PTFI”) with the signing of a sales and purchase agreement on Thursday, 27 September 2018. However, PT Indonesia Asahan Alumunium (“PT Inalum”), in its role as the official representative of the Indonesian Government, is required to pay for the shares which are being divested and which amount to USD 3.85 billion or around IDR 56 trillion.
- In order to fund the acquisition process for PTFI shares, PT Inalum is planning to secure a loan from a bank syndication. However, PT Inalum is also being encouraged to make a full public disclosure regarding any banks that eventually agree to provide the relevant loan funding, especially Chinese state-owned banks (“Chinese Banks”). This transparency is seen as important for the following reasons: 1) Further reliance on loans from Chinese Banks has the potential to compromise Indonesian sovereignty; 2) Chinese Banks will follow policy directives issued by the Chinese Government; 3) Public sentiment and sensitivities concerning China; and 4) The ongoing US-China trade war.
- For more on this story, see Hukumonline: “Waspadai Risiko Jeratan Bank Asing di Balik Divestasi Freeport”
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