Government Offers New JV to Cemex
According to local reports, the Indonesian government has offered an option to establish a joint venture between Cemex Asia and PT Semen Gresik to resolve the dispute between the two parties. "The establishment of the new unit will cover three assets of Semen Gresik," said Senior Economic Minister Aburizal Bakrie last week.
Bisnis Indonesia source, meanwhile, said that the establishment of new joint venture between Semen Gresik and Cemex would be an option benefiting Indonesian government, the major shareholder of the cement manufacturing company.
Before establishing the new unit, the minister said, Semen Gresik planned to sell three assets of the company, Tuban I, Tuban II and Tuban III to Cemex. "We will be able to use the fund from the selling of the three units of assets to develop another cement plans at the capacity of the same as those we have sold to Cemex," he said.
After the selling of the three units, the source said, Semen Gresik and Cemex would be able to establish a company to control the three assets. With such option, the source said, the government would be able to retain its 51% ownership at Semen Gresik, while Cemex would maintain some 25.5% shares of Semen Gresik.
The source said that the government would be able to establish a cement manufacturing company using the fund from the selling of assets so that the new facilities would have been operating in 2007, when the demand on cement had been increasing. If the option Cemex approved the plan, the source said, all interests would be accommodated.
Meanwhile...Cemex has agreed to halt legal action against the Indonesian government to pave the way for negotiations to resolve a protected dispute between the two sides, the Jakarta Post reports, citing a senior government official. Cemex will suspend lawsuit proceedings against the Indonesian government, scheduled for Jan. 11 at the Washington-based International Center for the Settlement of Investment Disputes, in order to facilitate negotiations between the two sides, the report says, citing Coordinating Minister for the Economy, Aburizal Bakrie. Those negotiations aim to end a deadlock that hinges on the refusal of local politicians on the Indonesian island of Sumatra to honor a contract that allows Cemex to increase its current 25.53 per cent share in PT Semen Gresik.