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Thursday, 20 August 09
INDONESIA'S DELTA DUNIA BUYS COAL FIRM FOR $550 MLN


* Delta Dunia to acquire BUMA for $550 million
* Expect to complete the deal in the fourth quarter of 2009
* Delta Dunia has appointed Barclays Capital to advise


Reuters world's largest international multimedia news agency reported that, Indonesian diversified company PT Delta Dunia Petroindo Tbk said on Thursday it has reached an agreement to buy a coal mining contractor PT Bukit Makmur Mandiri Utama (BUMA) for $550 million.

The owners of BUMA had put the company up for sale in May to private equity firms in Asia after failing to sell it in late 2007, sources familiar with the deal said

Mining services companies are struggling with costs amid slowing growth and slumping metal prices, making them ripe for takeovers, industry analysts said.

The sale was in line with a strategy "to increase shareholder value, and to grow revenue through a new mining and contractor platform, leveraging the ripe coal market opportunities in Indonesia," the firm said in a statement.

The firm said the transaction should be completed in the fourth quarter 2009, subject to obtaining shareholder and regulatory approval.

Newspaper Bisnis Indonesia has reported that local private equity group Northstar Pacific had purchased BUMA and that it could be listed through a backdoor listing after the purchase.

Gunawan Angkawibawa, a director at Delta Dunia, declined to comment on whether Northstar Pacific had a role in BUMA's purchase.

Delta Dunia has appointed Barclays Capital to advise on arranging the financing related to the acquisition.

Indonesia, the world's top thermal coal exporter, is expected to produce about 240 million tonnes of coal this year, slightly up from 238 million tonnes last year.
Source:Reuters



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