Newcrest Mining has signed an agreement to sell 100 per cent of Newcrest Singapore Holdings Pte Ltd (NSH), which owns a 75 per cent interest in PT Nusa Halmahera Minerals (PT NHM) and operates the Gosowong mine in Indonesia, to PT Indotan Halmahera Bangkit for A$90 million.
|Photo by Jonny Caspari on Unsplash|
Indotan will also gain 100 per cent interest in PT Puncakbaru Jayatama (PT PJ), which employs exploration personnel in Indonesia. The deal comprises of a $5 million cash deposit paid on execution of the sale and purchase agreement, $55 million cash payable on transaction completion and $30 million deferred cash payable 18 months after completion.
The sale of NSH follows a strategic review of the asset by Newcrest and to comply with the amended Gosowong Contract of Work, which required Newcrest to sell down to at least 49 per cent of PT NHM by 30 June 2020.
Newcrest Managing Director and Chief Executive Officer Sandeep Biswas, said: “Following an extensive review and sale process we are pleased to be able to announce the sale of Gosowong to Indotan. This outcome delivers value for Newcrest shareholders and provides a clear future path for Gosowong for the benefit of its employees and the community.
“Gosowong has been a valued part of our operating portfolio since we discovered it in 1993, with first production commencing in 1999. Over the last 30 years we have built valued relationships with our Indonesian joint venture partners, suppliers, employees, government and community stakeholders, and together achieved the strong culture we see today which is based on safety, trust and teamwork.
“I would like to extend my sincere thanks to all our Gosowong employees who have contributed so much to the success of Gosowong and Newcrest over the past few decades. All of us at Newcrest wish our Gosowong colleagues and Indotan all the best for the future.”
Subject to completion, Newcrest expects to recognise a $44 million loss on divestment of its 75 per cent interest in Gosowong.
*Article published in the April-June 2020 issue of The Asia Miner