(Sept 9): Indonesian tycoon Andi Syamsuddin Arsyad has bid just US$3 billion (RM12.2 billion) for a controlling stake in coal miner PT Bayan Resources, according to people familiar with the matter, a fraction of the firm’s current market value.

After weeks of negotiations, an entity controlled by Haji Isam, as Syamsuddin is frequently known, has made a cash offer for 62% of Jakarta-based Bayan’s shares, the stake currently held by billionaire Low Tuck Kwong and his daughter, Elaine, the people said. They asked not to be identified as the discussions are private.

The offer puts a price tag of roughly US$4.8 billion on one of Indonesia’s largest fossil-fuel producers — more than 80% below an equity market value of closer to US$26 billion.

The Low family’s majority interest has long been expected to sell at a discount because its limited free float and thin trading can inflate the market price. The longer-term outlook for thermal coal is also muted as consumers shift toward cleaner energy, plus Indonesia’s government has imposed a mining quota that has hobbled local players.

The sale talks are ongoing and there’s no guarantee a deal will be reached, the people said. Bayan shares fell as much as 3.5% on Wednesday before trimming losses to trade down 1.1% by 2.56pm in Jakarta.

A representative for Isam didn’t respond to a request for comment. Bayan Resources and the Low family also didn’t respond to requests for comment.

Isam, 49, is a businessman from Kalimantan who was among the biggest backers of Indonesian President Prabowo Subianto’s 2024 election campaign. His conglomerate, PT Jhonlin Group, is already a major coal miner in its own right, requesting a government quota to produce about 60 million tonnes of the fuel this year, Bloomberg reported in July. 

Acquiring a stake in Bayan would make him the Southeast Asian nation’s top coal magnate.

Any transaction would come amid a difficult trading environment for Indonesia’s miners, however. Prabowo has slashed the production quotas of some of the country’s biggest producers in an effort to boost coal prices. Other companies have been hit by steep fines for forestry permit violations.

Bayan was among those worst affected by the quota cuts, people familiar said. Competitors including PT Bumi Resources and PT Adaro Andalan were largely spared, Bloomberg reported in February.

Low, 78, was born in Singapore and moved to Indonesia in his early 20s. He took Indonesian citizenship in 1992 and founded Bayan Resources in 2004. Most of his net worth derives from the listed coal miner, according to the Bloomberg Billionaires Index. His other main assets include a 78% stake in Singapore-based renewable firm, Metis Energy Ltd.

Should all parties align on the terms of a deal, the transaction could complete before the end of the year, one of the people said. Isam will probably get financing from state-owned Indonesian banks, another said.

Bayan Resources also operates ports in Indonesia. It sold about 68 million tonnes of the fossil fuel last year when it also reported some US$3.4 billion in revenue.

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