Rothschild backs Bumi split in peace deal with management
LONDON Dec 13 (Reuters) - Financier Nat Rothschild, a co-founder of coal miner Bumi, has said he will support the company's plan to split with Indonesia's influential Bakrie family, in a peace deal that also allows him to nominate a director to the board.
Bumi said in a statement on Friday, just days ahead of a Dec. 17 shareholder vote on the separation with the Bakries, that Rothschild had agreed to support the split after talks with the company's board and outgoing chairman Samin Tan, who is set to buy the Bakrie shares and become the largest single investor.
Rothschild - one of Bumi's largest shareholders with an almost 15 percent stake according to Thomson Reuters data - founded the mining venture alongside the Bakrie family three years ago, but the relationship quickly soured.
He has also been at odds with the current management since stepping down from the board last year, criticising elements of the split plan and efforts to recover cash lost in subsidiaries.
In Friday's announcement, Bumi said Rothschild had also agreed to drop a court case that argued Bumi was run in a way that hurt, or "unfairly prejudiced" small investors.
"My first priority, as before, will be to protect the interests of Bumi Plc's independent shareholders. With that in mind, the best way I can currently influence the Company is to nominate a director to what will be an independent board dedicated to realising value," Rothschild said in the statement.
Bumi's management and its key Indonesian shareholders have been hammering out the details of a separation for months. The company's managers say a split with the Bakries will be a key step towards a long-awaited overhaul and efforts to refocus the group on its Berau coal operations.
The company will also change its name.
Bumi was created to bring Indonesian mining assets to London investors but has struggled with feuding shareholders.
The split, if approved by investors, will see the Bakries sell their stake to Tan. The Bakries will then buy back London-listed Bumi's 29.2 percent stake in troubled Jakarta-listed business PT Bumi for $501 million, above the market price.
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