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Salim Group Enters Coal Business Through BUMI

Wed 12 Oct 2022, 08:00 AM



Salim Group will expand into the coal business. The company owned by billionaire Anthony Salim will enter the coal business through the purchase of shares of PT Bumi Resources Tbk (BUMI).

Regarding this corporate action, BUMI will hold an Extraordinary General Meeting of Shareholders (EGMS) today, Tuesday (11/10/2022). In this agenda, BUMI Resources requested the approval of shareholders to increase capital without pre-emptive rights (PMTHMETD) or private placement.

In this case, BUMI Resources will increase its shares by 200 billion series C ordinary shares with an exercise price of IDR 120 per share or equivalent to IDR 24 trillion.

The shares will also be absorbed by 2 companies controlled by the Hong Kong-based Salim Group, namely Mach Energy Limited (MEL) and Treasure Global Investements Limited (TGIL). Both will own 85% and 15% of the shares released by BUMI Resources, respectively.

"MEL and TGIL are parties controlled by Anthony Salim and are companies belonging to the Salim business group," BUMI wrote.

Capital Market Observer and Founder of Central Capital Wahyu Tri Laksono responded regarding Salim Group entering BUMI Resources through a private placement.

He said that throughout the first semester of 2022, BUMI recorded revenues of USD968.68 million or equivalent to IDR 14.45 trillion (exchange rate of IDR 14,925) an increase of 129.6% from the same period or year-on-year (yoy). In the first semester of 2021, BUMI posted revenues of USD421.86 million or equivalent to IDR 6.02 trillion (exchange rate of IDR 14,285).

The net profit recorded by BUMI reached USD167.67 million or equivalent to IDR 2.5 trillion, an increase of 8,768% from USD1.89 million or equivalent to IDR 27 billion in the first half of 2021.

"This is clearly a positive sentiment for bumi resources," wahyu said when contacted by MNC Portal, Tuesday (11/10/2022).

Di said that since the Covid-19 pandemic and supply chain issues have triggered a global commodity boom, especially in the energy sector, which has increased, including coal.

"Although there is currently a price correction and the potential weakening of demand related to the threat of a global recession. But still the energy is sexy. The evidence is that OPEC is now reducing production and triggering a rebound in oil. Europe, which is anti-coal, is actually forced to use coal as well now," he said.

He assessed that the main factor in the price increase was because the gap between coal demand and supply was getting bigger. According to him, supply is always static or even declining while demand is getting bigger everywhere.

"Well, if Salim comes in this is part of the response to that potential," he said.

As is known, BUMI plans to issue 200 billion new shares at a price of IDR 120 per share. This means that if the shareholders agree to the corporate action that provides a dilution effect of up to 58.8%, BUMI will reap fresh funds of up to IDR 24 trillion.


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