Indonesia’s listed coal miner Indika Energy will sell its controlling interest in a listed coal miner arm Petrosea, to a private company Caraka Reksa Optima for $146.6 million to raise capital for its expansion in a new business venture, Indika said in a statement on Tuesday.
Indika said it had signed a share sale and purchase agreement on Feb 25, looking to sell 704.01 million shares or, 69.8 percent interest, in Petrosea to Caraka, in a deal that would value Petrosea at around $210 million, or about 9.4 percent above the company’s market capitalization on Tuesday morning.
The companies expected to close the deal by the end of May, depending on the fulfillment of several preliminary conditions stipulated in the agreement.
According to Azis Armand, Indika Energy’s deputy president director and group chief executive officer (CEO) said, the company was embarking on a drive to diversify its business outside the energy and mining sectors.
“The proceeds from the sale of Petrosea will be used to strengthen the company’s finances, as well as fund the company’s business diversification that prioritizes sustainability aspects to maximize shareholder value,” Azis said in the statement on Tuesday.
Petrosea is a company engaged in contract mining, particularly coal. Indika said Petrosea sale was part of its strategy to realign its business portfolio, achieve the target of 50 percent revenue from the non-coal sector by 2025 and become a carbon-neutral company by 2050.
Previously in January, Indika joined forces with Taiwanese Foxconn’s listed flagship company Hon Hai Precision Industry, Indonesia’s state-owned battery maker Indonesia Battery Corporation (IBC), Taiwan’s electric bike maker Gogoro Taiwan to develop electric vehicles ecosystem in Indonesia.