Share Divestment Reaches Agreement, Vale Indonesia Directors Will Be Overhauled

Minister of State-Owned Enterprises (BUMN) Erick Thohir. (Mery Handayani/VOI)

JAKARTA - SOE Minister Erick Thohir opens the opportunity for a new composition of directors in the management of PT Vale Indonesia Tbk (INCO). This is part of the stock divestment agreement to the Mining Industry BUMN Holding, MIND ID.

Furthermore, Erick explained that the change in directors was possible because MIND ID would later become the majority shareholder of Vale Indonesia.

For your information, MIND ID currently owns 20 percent of Vale Indonesia's shares which have been controlled since 2020. With the divestment of the remaining 14 percent, MIND ID will become the majority shareholder.

"Yes, there must be a discussion, yes, later the board of directors will also have representatives from us because we are the 34 percent largest shareholder, then the rest are public," he said when met at the Danareksa Tower, Jakarta, Tuesday, February 20.

Erick also said that when Vale became part of the ecosystem at an angry state company, the government would continue to encourage the acceleration of investment and downstreaming.

"For us, when Vale becomes our ecosystem, we will encourage the acceleration of investment and downstreaming in Vale, which has been quite slow and the momentum of downstreaming in Vale is a very good momentum. We can see yesterday that I came to the Indonesian International Motor Show (IIMS) automotive exhibition. I see demand for electric cars is increasing," he said.

Previously, the Special Staff of the Minister of SOEs Arya Sinulingga revealed negotiations related to the divestment of the share price of PT Vale Indonesia Tbk. (INCO) has reached good agreements. One of them, BUMN has the right to place directors and commissioners.

"Because of SOEs, the government has the largest majority, so he has the rights of which directors, which directors, then which commissioners, which commissioners," he said when met at the Ministry of SOEs, Monday, February 19.

"With itself, if the share ownership is different, then it will definitely be more, because yesterday it was only how much percent, right. Now it's up to the majority, so surely he has certain rights from the consequences," he continued.

Even so, Arya said that the Ministry of SOEs has not yet pocketed the names who will be included in the board of commissioners and directors of PT Vale Indonesia Tbk.

"If the share ownership is different, he must have certain rights. There are no candidates yet," he said.

For your information, For your information, the release of Vale Indonesia's shares is a requirement that must be met for an extension of the contract which will expire on December 28, 2025. Where, at least 51 percent of the shares are controlled by the Indonesian side.

Vale Indonesia's share composition is 43.79 percent held by Vale Canada Limited who is also the controller. Then, 15.03 is held by Sumitomo Metal Mining. Then, 20 percent is held by the public with a list on the Indonesia Stock Exchange (IDX).

Meanwhile MIND ID owns 20 percent of Vale Indonesia's shares that have been controlled since 2020. So with further divestment of 14 percent, Indonesia even owns 54 percent of Vale Indonesia's shares. In detail, 34 percent of the shares owned by MIND ID and 20 percent of the shares on the IDX.