“The discussions have been progressing but have highlighted the need to jointly manage the process on both the Australian and Indonesian stock exchanges and under two company regulatory regimes,” Cokal said in a statement.
“We believe that as this is the first such transaction of this type between the two countries, there is no precedent. An understanding of these processes has been extremely important before reaching an agreement on a bid implementation agreement.”
So far, Cokal has not formed an opinion on the takeover offer, and says discussions are ongoing to try to evaluate the proposal.
It says shareholders should take no action.
What is known about the offer so far is that Cokal’s minority partner in its four Central Kalimantan leases wants to expand its mining operations and create a coal mining division to sit alongside its iron ore mining and mineral commodities trading.
It wants 90% acceptances of Cokal, and it is prepared to spend about $70 million, paying around $0.19 per share.
Cokal is seeking to develop a new coal mine in Indonesia’s Central Kalimantan region, and its bid to start construction has progressed to the BKPM, Indonesia’s coordinating investment board of Indonesia, the final government body needed to sign off on the permit.
Cokal believes the BKPM now has all the necessary documentation to issue its approval and expects the final review to move quickly, although the company warned that it is at the forefront of a new government process, there may still remain some teething issues which may cause slight delays in the timing of the approval.
It already has secured its in-principal forestry permit for the BBM project, which also needs to be finalised, although that process was also delayed due to the amalgamation of the Environment and Forestry Department under the new government.
BBM covers an area of 14,980ha, immediately adjacent to BHP Billiton’s Juloi tenement.
The permit straddles the Barito River and has numerous outcrops of bright coal.
Coal core samples analysis confirmed BBM’s coal to be a premium coking coal with low ash, low sulphur and ultra-low phosphorus.
The total coal resource is estimated at 266.6 million tonnes, comprised of 19.5Mt measured,
23.1Mt indicated and 224Mt inferred resources. About 90% is coking coal and 10% PCI coal.
Cokal also has interests in Tanzania and Mozambique, but is primarily focused on moving BBM into production.
The company’s shares were at $0.10 this morning.
