Metallurgical coal group Cokal Ltd has received an unsolicited non-binding and incomplete proposal in relation to a conditional off market takeover bid by PT Cakra Mineral Tbk (CKRA) for all of the ordinary shares of Cokal. CKRA is an Indonesian company listed on the Indonesia Stock Exchange. Cokal has not formed any opinion on the proposal and its present intention is to engage with CKRA to evaluate the proposal.

In a statement Cokal said: “The outcome of the proposal is speculative. Shareholders should be aware that there is no certainty that any agreement will be reached or that any transaction will eventuate from the current or any future discussions. Shareholders should take no action at this stage until the directors have evaluated the proposal.”

CKRA proposes to acquire all of the issued securities of Cokal pursuant to a conditional off market takeover bid on the following terms:

(a) CKRA proposes to offer cash or CKRA shares for each Cokal share on issue:

i. Cash Settlement: Based on Cokal equity value of Aus$70 million. Assuming approximately 471.5 million Cokal shares on issue, proposed cash offer price is Aus$0.15 per share.

ii. Share Settlement: Shares in CKRA equivalent to the value of Cokal shares. Value of CKRA shares to be agreed. Cokal equity value to be Aus$70 million plus 25% premium. Assuming approximately 471.5 million Cokal shares on issue, proposed scrip consideration implies offer price of Aus$0.19 per share.

(b) The bid will be subject to:

i. Minimum acceptance by holders of 90% of Cokal’s issued shares;

ii. Other terms: certain conditions which are customary for an off market bid for an ASX listed company

CKRA is domiciled in Central Jakarta and has operations in the provinces of West Sumatra and Central Kalimantan. The main activity is as a holding company conducting mining operations of iron ore, zircon sand and performing marketing services for the business group.

The company has several subsidiary companies engaged in iron ore mining and mineral commodities trading. CKRA wishes to expand their mining operations and create a coal mining division. To achieve this CKRA has recently been active in acquiring a number of coal tenements including taking the following minority interest in Cokal’s exploration properties:
• PT Tambang Benua Alam Raya - 25%
• PT Anugerah Alam Katingan - 25%
• PT Anugerah Alam Manuhing - 25%
• PT Silangkop Nusa Raya – 24.8%

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