Indonesian nickel miner PT Ceria Nugraha Indotama is set to receive backing from Glencore to build a battery metal plant ahead of its planned initial public offering (IPO) next year.
Glencore is negotiating to acquire a 10% stake in the company through a pre-IPO fundraising round and will help finance Ceria Nugraha’s high-pressure acid leach plant, CEO Derian Sakmiwata announced on Wednesday.
The world’s largest commodities trader will also sign an offtake agreement to purchase electric vehicle battery materials from the Indonesian firm.
“We want to reach the global market,” Sakmiwata stated at the Shanghai Metals Market conference in Jakarta. “Glencore is our bridge.” He added that 20% of the company is being offered as part of the pre-IPO fundraising.
Glencore did not immediately respond to a request for comment.
Headquartered in Switzerland, Glencore is increasing its involvement in the Indonesian nickel industry, which accounts for about half of the world’s production.
It is also considering acquiring a stake in miner PT Trimegah Bangun Persada, also known as Harita Nickel.
A 2020 ban on the export of raw ore led to a significant influx of Chinese investment in Indonesian nickel smelting, causing production to soar and benchmark prices to plummet.
Unusually, no Chinese firm holds an equity stake in Ceria’s projects, although China ENFI Engineering has been contracted to build them.
Ceria Nugraha aims to keep its product eligible for subsidies related to the US’s Inflation Reduction Act by limiting Chinese ownership.
“We are not ruling out the Chinese, but we want our product to be acceptable in global markets,” Sakmiwata said.
Ceria Nugraha’s first smelter is scheduled for completion this year, with plans for $8 billion in investment in a series of processing plants to produce nickel and cobalt chemicals for EV batteries. Part of this investment will be funded through the IPO next year.
Macquarie Group, BNP Paribas, and Mandiri Sekuritas have been appointed as advisers for the listing. Before the IPO, the company will raise funds through private sales, including from Glencore, Sakmiwata said.
