May 21, 2013 / 4:51 AM / in 5 years

Indonesia mogul ready to discuss deal on Intrepid project -letter

MELBOURNE, May 21 (Reuters) - An Indonesian tycoon who owns a big stake in a huge copper and gold prospect taken from Australia’s Intrepid Mines last year is willing to resolve the ownership dispute, he said in a letter to an investor looking to oust the company’s board.

The dispute is over the Tujuh Bukit project, potentially holding 30 million ounces of gold and 19 billion pounds of copper, now owned by Bumi Sukses Indo (BSI), led by Provident Capital Partners and Edwin Soeryadjaya.

Intrepid Mines last year lost an 80 percent interest in the project when its Indonesian partner PT Indo Multi Niaga set up a new company, BSI, and sold stakes in it to Indonesian investors.

The Australian company has been pursuing several legal approaches to win back its rights but has had little discussion directly with BSI.

It is now trying to fend off an activist fund, Quantum Pacific, that wants to oust the board and negotiate a deal with BSI to try to restore some value to Intrepid, whose shares have lost nearly 90 percent of their value over the past year.

Quantum Pacific, which has a stake of 5.4 percent in Intrepid, has been talking to Soeryadjaya ever since he got involved with the Tujuh Bukit project and obtained a letter from him in March saying he would be willing to negotiate with the fund.

“We welcome and encourage Quantum or any other party to pursue a course of action involving amicable discussions regarding Tujuh Bukit,” Soeryadjaya said in the letter dated March 25, obtained by Reuters from Quantum Pacific.

The Indonesian businessmen, whose private equity firm PT Saratoga Investama Sedaya is in the midst of launching an initial public offering, has not responded to requests for comment on the Intrepid Mines dispute.

In the letter, he said he wanted to resolve the dispute with Intrepid.

“However, we are not optimistic that such an outcome could be agreed with the current Intrepid management, given the way they have conducted their relationships with local parties in Indonesia and their confrontational statements in the press,” Soeryadjaya said in his letter.

Reuters has not independently verified that Soeryadjaya sent the letter.

If Quantum Pacific is successful in its plan take over the board of Intrepid at a vote on June 20, it aims to win back a direct stake in Tujuh Bukit, though not as much as 80 percent, within six to nine months, Quantum Pacific managing partner Greg Mazur told reporters on Monday.

Mazur has criticized Intrepid for having spent $100 million on work at Tujuh Bukit without securing rights to the project, but on Monday said there was value in the work the firm had done, when asked why Quantum Pacific had invested in Intrepid.

“It’s becoming obvious the Indonesian players need Intrepid, otherwise why would you bother?” Intrepid Chief Executive Brad Gordon told Reuters.

Reporting by Sonali Paul; Editing by Clarence Fernandez

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