Concession, ferronickel smelters and electronic vehicle battery material factories on Obi Island, South Halmahera Regency, North Sulawesi Province. COURTESY OF TRIMEGAH BANGUN PERSADA
Indonesia’s Harita Group is selling stakes in its Trimegah Bangun Persada nickel unit in a major IPO that could see billionaire Lim Hariyanto Wijaya Sarwono’s net worth skyrocket.
According to the company’s prospectus, Trimegah Bangun Persada will raise between Rs. 14.7 trillion (US$960 million) and Rs Total shares at a price range of 1,220 rupiah is offering 1,250 rupiah.
The Indonesian miner aims to tap into the rising demand for materials needed to make batteries for electric vehicles. Trimegah Bangun Persada was founded in 2004 and was bought by Harita Group three years later. It has a nickel mining concession on Obi Island in North Maluku Province.
Underwriters for the IPO include BNP Paribas, Citi, Credit Suisse and Mandiri Sekuritas. The shares will start trading on the Indonesian Stock Exchange on April 12, according to the company.
Trimegah Bangun Persada will use the IPO proceeds for debt repayment, working capital, investments and paid-up capital in subsidiaries. “We intend to expand production capacity at our nickel processing facilities, in line with the government’s vision to accelerate the downstream mining industry in Indonesia,” Roy Arman Arfandy, president and director of Trimegah Bangun Persada, told Forbes Asia on Wednesday.
The company is conducting a bookbuilding process from March 15th to March 24th. It held roadshows for global investors in Singapore, Hong Kong, the US and European countries and will hold a public presentation in Jakarta on Friday. “We have received strong interest from global and local potential investors,” said Arfandy.
Lim Hariyanto Wijaya Sarwono owns 82% of Trimegah Bangun Persada through his holding companies Harita Jayaraya and Citra Duta Jaya Makmur. The IPO could increase his net worth to $4.8 billion from $1.1 billion. Aside from the nickel unit, the family owns majority stakes in Singapore-listed palm oil company Bumitama Agri and Indonesia-listed bauxite mining company Cita Mineral Investindo.
Trimegah Bangun Persada initially exported its nickel ore to the world market. However, in early 2014, the Indonesian government banned the export of nickel ore to boost the domestic downstream mining industry, which is expected to boost economic value for the Indonesian people through job creation and investment, and for the government through state revenues. The government eased policy between January 2017 and December 2019, allowing the export of nickel ore with a nickel content less than 1.7%, and from January 2020 it banned all exports of nickel ore outright.
IPO to expand production capacity at its nickel processing facilities.COURTESY OF TRIMEGAH BANGUN PERSADA
In response to government policies, Trimegah Bangun Persada has been expanding into nickel processing industry since 2015 with a total investment of US$1.2 billion. The Company began construction of a Rotary Furnace Electric Furnace (RKEF) smelter in 2015, which began producing ferronickel in 2017, which is an intermediate nickel product, in 2021.
For the first eleven months of 2022, the company reported revenue of 9 trillion rupiah ($586 million), up 18% from $499 million a year earlier, with net income of $280 million, a 3.3x increase from $83 million per year earlier.
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I’m a contributing editor at Forbes Asia based in Jakarta, Indonesia. With over a decade of journalism experience, I am interested in following the wealth of Asia’s richest. Before joining Forbes Asia, I worked for several media companies including Forbes Indonesia, Kontan and most recently Capital Profile. For news tips you can reach me at [email protected]
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