UPDATE 1-Rothschild backs Bumi split in last-minute peace deal
* Rothschild deal allows him to nominate a non-executive director
* Shareholder vote expected on Dec. 17
* Split will mean parting company with co-founding Bakries
LONDON, Dec 13 (Reuters) - Financier Nat Rothschild, a key shareholder of coal miner Bumi, has agreed to back the company's planned split with Indonesia's Bakrie family, in a last-minute peace deal with management that paves the way for the long-awaited divorce.
Rothschild co-founded Bumi with the politically influential Bakrie family in 2010, with the aim of bringing promising Indonesian coal mining assets to London's stock market.
But their relationship quickly soured, and the company has since been battered by boardroom battles, allegations of wrongdoing and recriminations on both sides - all alongside a sharp drop in the price of thermal coal.
Shareholders will vote on Tuesday on the plan to part company with the Bakries and sell back to them a minority stake in debt-laden unit PT Bumi Resources - a blueprint hammered out over much of the past year and seen by the management as crucial to Bumi's overhaul.
Bumi said in a statement on Friday that Rothschild had agreed to support the split after holding 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.
As a result of the deal, Rothschild, one of Bumi's largest shareholders, will be able to name an independent, non-executive director to the board - a year after resigning his own position.
Rothschild has been at odds with the current management since that high-profile departure from the board, questioning their credentials, criticising elements of the split plan, as well as efforts to recover cash lost in subsidiaries.
Friday's announcement draws a line under those months of acrimonious clashes. It also closes a court case brought by Rothschild 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," Rothschild said in the statement. "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."
Though he has a smaller proportion of the overall shares in issue, Rothschild holds roughly 21 percent of Bumi's voting shares. Given neither the Bakries nor Tan can vote on the split itself, that means Rothschild and his closest supporters guarantee roughly a third of those eligible to vote on Tuesday will back the main proposal.
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, combined with a name change, will be a key step towards a long-awaited overhaul and efforts to refocus the group on the operations of its Berau coal subsidiary, which is majority owned by Bumi.
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 Jakarta-listed business PT Bumi for $501 million, above the market price.
"We welcome Nat's support and look forward to progressing with the split," a Bakrie spokesman said.
While Tan has been made to prove his ability to pay for his share of the deal, the Bakries' have not been required to show how they will raise the cash needed for their part - covering the shortfall between Bumi Plc's shares and the price agreed for PT Bumi stock.
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