Dec 29, 2010

Bayan soars 4.47% on Kangaroo deal

Coal miner controlled by Dato' Low Tuck Kwong and Jenny Quantero PT Bayan Resources Tbk (BYAN) rose 4.47% to Rp18,700 per share.
The stocks have steeply soared 31.69% to Rp18,700 from December 21 at Rp14,200 per share. Considering the price today, Bayan stocks are so expensive. It is traded at 139.87x of price to earning ratio (P/E).
Bayan's earning per share in September was Rp147 and annualized of Rp196. Regarding to annualized EPS, Bayan stocks are traded at 95.41x P/E by end of this year. 
In an official statement last night, Bayan announced an acquisition agreement of nine coal concession assets from PT Ilthabi Bara Utama and Prime Mine Resources Ltd.
The coal assets have resources of 3.8 billion metric tons and 116 million metric tons reserves. These concessions are strategically located adjacent to Bayan’s existing Tabang mines which are already in production. The acquisition includes existing infrastructure which will complement and fast track the growth of production of the combined assets.
“This transaction is in line with Bayan’s strategy of growth through acquisition and expands our resource base whilst also providing significant infrastructure and operational synergies," said Eddie Chin, President Director of Bayan, in a press statement.
Based on share purchase agreement signed by Bayan and Kangaroo Resources on December 28 2010, Kangaroo Resources will issue new shares, enabling Bayan Resources to control Kangaroo Resources.
Jenny Quantero, Bayan Corporate Secretary, said Bayan has agreed to takeover 100% holding in PT Tanur Jaya, PT Apira Utama, PT Cahaya Alam, PT Bara Sejati from Ilthabi Bara Utama and Romo Nitiyudi Wachjo.
Bayan Resources also agreed to buy 99% shareholdings in PT Tiwa Abadi, PT Sumber Api, PT Silau Kencana, PT Orkida Makmur, and PT Dermaga Energi, from Ilthabi Bara Utama, Prime Mine Resources, and Romo Nitiyudi Wachjo.
"We anticipate the acquisitions will be accomplished by end of the first quarter of 2011 after Bayan completes the due diligence," Jenny said. 

Disclosure: No position at the stock mentioned above. 

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