Cokal in talks with Blumont on funding, takeover

Cokal said it has been in discussions with Singapore-listed Blumont Group about a $77-million funding package for its Bumi Barito Mineral (BBM) coking coal project in Indonesia.

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In addition, the two parties are close to finalising Blumont’s potential A$124-million ($117 million) takeover of Cokal, the Indonesia-focused coal miner said on Tuesday October 8.

The priority, however, is the $77-million facility, which would enable Cokal to build the BBM mine in Central Kalimantan, Indonesia and infrastructure to reach first production in the first half of next year, according to the miner’s statement .

Cokal noted the significant downward movement in Blumont’s share price over the past few days and said that it would “materially and adversely” affect the commercial terms of the takeover proposal.

Blumont shares were trading at S$0.15 ($0.12) at the time of writing, down from a closing price of S$2.02 ($1.62) on October 3.

“Blumont and Cokal continue to believe in the strategic merit underpinning Blumont’s proposals, further discussions are now occurring to restructure the financing and potential takeover offer,” Cokal said.

Blumont said the volatility in its share price may be partly due to a local broking house recently declaring its shares as designated securities.

Blumont has a global portfolio of diversified assets in the minerals and energy resources sector, including those of coking coal, thermal coal, gold, copper and uranium.

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