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Indonesia, Vale agree price for divestment plan, Minister says

16th February 2024

By: Reuters

  

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JAKARTA - Indonesia and Vale Base Metals have concluded negotiations and agreed in principle to a price for the portion of shares the miner will sell in its Indonesian unit INCO, the Mining Minister said on Friday.

Vale Canada, a unit of Vale Base Metals, and Japan's Sumitomo Metal Mining signed an initial agreement to sell a 14% stake in their Indonesian nickel mining unit to Indonesia's state mining holding company, MIND ID last November.

Minister Arifin Tasrif did not mention the price, but he said it would be below the current market price. Vale was not immediately available to comment.

Share divestment is a condition required by authorities to extend Vale Indonesia's mining permit, which will otherwise end in 2025. Foreign investors are required to divest 51% of their stakes to local buyers after a certain period of operation.

Upon completion, MIND ID will become the largest shareholder of Vale Indonesia with its stake rising to 34% from 20%. Vale Canada will hold 33.9%, down from 43.79%, and Sumitomo 11.5%, down from 15.03%, according to a statement in November.

About 20% of Vale Indonesia's shares are publicly traded.

Edited by Reuters

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