Chapter 7

Family Control

Figures converted from Indonesian rupiah at historical FX rates — see data/company.json.fx_rates for the rate table. Ratios, margins, and multiples are unitless and unchanged.

One family holds about 82% of Harita, and its interests line up with minority holders on the cheap-to-align things: a lean, cash-only, non-dilutive pay bill of $3.1m (about 0.6% of profit), a dividend every share receives equally, and zero equity held by the people who run the company. The alignment that is harder to verify is operational: roughly 22% of revenue and 16% of cost of goods sold pass through Harita-group entities on terms the company states may differ from those with unrelated parties.

Ownership: control at the holding company, none at the desk

Harita is a controlled company in the fullest sense. At the end of 2025, PT Harita Jayaraya held 81.32% of the shares, with a further 0.87% in PT Citra Duta Jaya Makmur, an entity inside the same family control chain that runs up to Lim Gunawan Hariyanto [1] [2]. Glencore appeared on the register during 2025 with 7.19%, and the public free float is 10.44% [1].

That control level rewards a distinction the reader should hold onto: control is not the same as alignment. The family's economic interest is real skin in the game — it is exposed to the same share price and the same dividend as every minority holder. But the alignment runs through the holding company, not through the individuals on the board. Every member of the Board of Directors and the Board of Commissioners owned no shares, directly or indirectly, at the end of 2025 [1] [3]. The executives are professional managers — the president director is a career banker, the finance director a former audit-firm and group-company CFO — not owner-operators [4].

Source: FY2025 Annual Report, Shareholder Information [1].

Two smaller moves are worth noting because they change the control math at the margin. The family reduced its own stake across 2025, from 84.69% at the start of the year to 81.32%, and continued to 79.75% by the end of March 2026 — the mirror image of Glencore's arrival and a modest widening of the float [1] [5]. Neither dents the family's absolute control, but a strategic trader taking 7% is an arm's-length party now sitting alongside minorities.

Pay is lean, in cash, and does not dilute

For a founder-run business, the compensation record is the first place a skeptic looks for extraction. Here it is unusually clean. Total remuneration for both boards was $3.1m in 2025 — $2.6m for the five directors and $0.5m for the three commissioners — up 6.2% from $3.0m in 2024 [6] [4]. Against $537m of profit attributable to owners, that entire bill is 0.57% of earnings [4].

Source: FY2025 Annual Report, remuneration table and audited Note 35–36 [6] [4].

Two features matter more than the size. First, pay is entirely cash — salary, bonus, and benefits in kind — with no stock options or share-based compensation granted in 2025, or in any year since listing [6]. A minority holder's stake is never diluted to pay management. To put the scale in context, the 110.7 million shares Harita repurchased in 2025 cost $4.5m — more than the entire board's annual pay — at an average of $0.041 per share [7]. Second, remuneration is set by the general meeting of shareholders, which then delegates the detailed split to the Board of Commissioners; two of the three commissioners are independent [8].

Two disclosure limits qualify the picture rather than overturn it. The company reports pay only in aggregate for each board, declining to break it out by individual on competitive grounds, so no single-executive figure or pay ratio can be checked [9]. And the audited note flags that some key managers also serve as key management of subsidiaries and associates and are paid by those entities too — so the $3.1m is what Harita itself pays, not necessarily the full amount these individuals draw across the group [4].

Dividends: the policy floor, shared pro-rata

The dividend is where family and minority interests visibly coincide. Harita's stated policy is to pay at least 30% of net profit, and it has paid exactly that floor every year since listing: $0.0014 per share for 2022, $0.0017 for 2023, and $0.0019 for 2024 — the last a $118.7m distribution paid on 30 June 2025 [10]. The family receives its ~81% of that pool at the same per-share rate as everyone else; there is no special class, no preferential coupon.

Source: FY2025 Annual Report, Dividend and Dividend Policy [10].

The reading is double-edged. Paying the floor and no more means the family, like every holder, leaves roughly 70% of each year's earnings inside the company. That retained capital funds growth — but, as the next two sections show, a large part of it recycles through Harita-group counterparties and back into stakes bought from the parent.

The related-party web

The material governance question at Harita is not pay; it is the volume of business the company does with the family's other entities. In 2025, sales to related parties reached $394m, or 22.19% of revenue, up sharply from 14.09% a year earlier [11]. Purchases booked into cost of goods sold ran to $193m, or 16.13% of COGS [12]. Nearly a quarter of what Harita sells, and a sixth of what it spends to produce, is transacted inside the family group.

Source: FY2025 audited financial statements, Note 35 [11] [12]. Sales as a share of revenue; purchases as a share of cost of goods sold.

The two sides of that web have different characters. The sales are ore sold by Harita's mining segment to the three processing associates it part-owns — PT Obi Nickel Cobalt (7.86% of revenue), PT Karunia Permai Sentosa (7.58%) and PT Halmahera Persada Lygend (6.75%) [11]. Because Harita owns 40%, 35% and 45.1% of those buyers, value shaded from the mining segment toward an associate is partly recovered through equity income. The purchases are different: they are inputs and services — coal, mining contracting, hauling, shipping, stevedoring and electricity — bought from entities under common family control that Harita does not own at all [13]. Those are a straight outflow to the family vertical, with no offsetting stake.

Source: FY2025 audited financial statements, Note 35, cost of goods sold to related parties [12].

What a minority holder cannot verify is the pricing. The company is candid about the standard it applies: related-party transactions are made "based on terms agreed by the parties, which may differ from those made with unrelated parties" [14]. That is not a claim of arm's-length pricing benchmarked to market; it is a negotiated price between affiliated parties. The filings disclose the volumes and the counterparties in full, but not a margin comparison against third-party terms — so whether the family's captive coal, shipping and contracting are priced fairly to Harita is taken on trust. The company states there were no material conflict-of-interest transactions in 2025 [14].

Buying the associates from the parent

The related-party relationship extends beyond the income statement to the balance sheet, where Harita has repeatedly bought assets from its own parent. The clearest case is Obi Nickel Cobalt, the HPAL plant whose stakes now sit among the associate holdings covered in The Associate Stakes. Harita lifted its ONC stake from 10% to 20% in December 2024 for $130m, then bought a further 20% from PT Harita Jayaraya in June 2025 for $259m, taking it to 40% [15] [7]. That June purchase is the governance test case, and Harita handled it the way minority protection requires: the price, $206 per share, was set by an appointed independent public appraiser (KJPP) rather than negotiated between affiliates [7]. It is the same pattern as the 2023 purchases of ore-reserve subsidiaries from the parent [16].

The distinction that matters is between the operating flows and the M&A. The large, one-off acquisitions from the parent carry an independent appraisal and OJK affiliated-transaction process; the recurring operating purchases do not carry a disclosed market benchmark. A useful external check exists for at least one associate: Lygend, ONC's other major shareholder, disclosed that ONC paid a $100m dividend in July 2025 and that $40m of it went to Harita — confirming both the 40% economic stake and that cash flows out of the associate pro-rata, not selectively [17].

What the evidence supports

On the tests this reader cares about, Harita scores well where alignment is cheap and mixed where it is expensive to verify. The family has genuine skin in the game at ~82%, takes its return through the same dividend and share price as minorities, pays its managers modestly and in cash with no dilution, and priced its largest related-party acquisition off an independent appraisal. The offsetting fact is that a controlled company running ~22% of sales and ~16% of costs through family entities, on admittedly non-arm's-length terms and with pay disclosed only in aggregate, asks minorities to trust a pricing process they cannot audit from the outside.

Source: synthesis of FY2025 audited financial statements and Annual Report, Notes 35 and remuneration/affiliated-transaction disclosures [11] [14].