Gold miner seeks $284 million in largest Indonesia IPO this year

PT Merdeka Gold Resources is planning to raise 4.66 trillion rupiah ($284 million) from what would be Indonesia’s largest initial public offering this year.

The gold miner will offer 1.62 billion shares, or a 10% stake, at 2,880 rupiah each, according to terms of the deal published on Investor Daily newspaper on Tuesday. The shares were priced near the upper end of the stock’s marketed range of 1,800 rupiah to 3,020 rupiah.

Gold’s continued rise — it hit another record on Tuesday — is providing a tailwind for miners such as Merdeka to raise funds for further expansion or pay off debt. Chinese giant Zijin Gold International Co. is planning to raise at least $3 billion in what is set to be the world’s biggest listing since May.

Merdeka’s offering also helps bolster Indonesia’s market for IPOs, which had been on track for a second consecutive year of declines, according to data compiled by Bloomberg.

The company plans to use the proceeds as working capital and repay loans, it said in its prospectus. It is developing a mine in Indonesia’s Sulawesi island and targets to produce approximately 140,000 ounces of gold per year in the initial phase, according to its website.

Merdeka is a unit of listed miner PT Merdeka Copper Gold, which is backed by prominent Indonesian businessmen, including Garibaldi Thohir, Edwin Soeryadjaya and Sandiaga Uno. Shares of Merdeka Copper Gold have risen more than 56% this year.

(By Prima Wirayani)