Reuters reported that Indonesia's government is in talks to buy out the Japanese majority owners of aluminium producer PT Inalum for an estimated USD 700 million.

The southeast Asian nation's industry minister said that the talks over PT Inalum whose output of aluminium ingots last year fell 0.9% from 2010 are part of Indonesia's efforts to generate increased revenue from its abundant natural resources and curb foreign ownership in the sector.

Nippon Asahan Aluminium, a consortium of 12 Japanese firms holds 58.8% of PT Inalum while the Indonesian state owns the rest. The consortium's 30 year contract is due to expire next year and the government has long since indicated that an extension is unlikely.

Mr Mohamad Hidayat industry minister of Indonesia said that "The decision is that the Indonesian government will terminate the contract and will then take over the Japanese NAA consortium's stake in Inalum. We are still discussing with our Japanese counterparts how much we should pay. Our rough calculation is around USD 700 million. Once the deal went through, the company could be run as a state-owned enterprise or taken over by a state owned consortium, or the stake could be sold on the stock exchange.”

Source - Reuters

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