Jan 3, 2011

Borneo soars 11% on Posco deal talks

Hard coking coal miner PT Borneo Lumbung Energi & Metal Tbk (BORN) today soared 11.19% to Rp1,490 per share, spurred by a market rumor that steel maker Posco soon to buy some stake in Borneo.
Besides the rumor, the coking coal prices, especially Goonyella coking coal has increased to US$221 per ton in 1Q 2011 from US$204 per ton.   
In line with Goonyella, a report from BHP Australia, quoting the Barlow Jonkers and McCLoskey coal price index, said Q1 2011 spot market prices for coking coals type Peak Down increased by US$16 per ton.
The Peak Down coking coal is to increase from US$209 to US$225 per tons, and the Goonyella coking coal from US$204 to US$221 per tons, the report specified.
BORN's hard coking coal is the Goonyella type, and therefore there will be an increase of US$17 per ton for our coal in the spot market.
The company sold 4.42 billion new shares or 25% stake of its enlarge capital during the IPO at Rp1,170 per share, enabling it snaps up Rp5.17 trillion proceed.

Disclosure: No position at the stock mentioned above.  

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