EMR consortium exits Indonesia's Martabe to strategic player

The deal will see Agincourt Resources, a special purpose vehicle controlled by EMR that holds a 95% stake in Martabe’s holding company, exit its entire stake based on an enterprise valuation of $1.21 billion. According to a statement, the transaction is expected to close before the end of 2018.

Martabe is located in North Sumatra and went into production in 2012. As of December 2017 the mine had a resource base of 8.8 million ounces of gold and 72 million ounces of silver; in the previous 12 months it produced 355,000 ounces of gold and 2.8 million ounces of silver.

An EMR-led consortium acquired Martabe through Agincourt from Hong Kong-listed G-Resources in 2016 for $775 million. AVCJ understands that the consortium members contributed $285 million in equity to the transaction, with the rest covered by debt. EMR holds a 61.4% interest in Agincourt and Farallon holds 20.6%, while the remainder is controlled by three Indonesian investors.

Martabe has achieved considerable growth under EMR’s holding, with production increasing by more than 15% through gains in throughput, and cost per ounce of gold reduced by 20%. This has led to a threefold increase in net profit.

EMR seeks controlling stakes in companies focused on copper, gold, coking coal, and potash. The Australia-based GP is currently investing its second fund, which closed in 2016 at $860 million. Its portfolio includes Golden Grove, a precious metals mine in Western Australia acquired last year for $210 million, and a coal mine in Queensland acquired alongside Indonesian energy firm Adaro Energy earlier this year for $2.25 billion.

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• Topics
• Southeast Asia
• Industrials
• Trade sale
• Indonesia
• Commodities
• EMR Capital
• Farallon Capital
• Exit