Property developer BCIP set to expand into mining business

Indonesia-listed property developer PT Bumi Citra Peramai Tbk (BCIP) plans to expand into mining business by acquiring iron ore miner PT Gunung Besi Utama, Kontan business daily reported on Wednesday.

For the acquisition purpose, BCIP will buy mandatory convertible notes worth US$47.5 million issued by PT Gunung Besi Utama to Nabil Enterprises Limited of United Arab Emirates.

?We had signed a memorandum of understanding with Nabil Enterprises on Aug 29,? said BCIP?s Corporate Secretary Yusli. If BCIP realized the purchase of the convertible notes, it would be able to control 97.48 percent of Gunung Besi?s shares.

Gunung Besi is engaged in iron ore mining through its subsidiary PT Mega Karya Dwipa which operates an iron ore mine in Bonti, Sanggau regency, West Kalimantan.

BCIP will use proceeds from its recent right issue to buy the convertible notes. The company raised about Rp 2.4 trillion from the right issue. (*)