JAKARTA/LONDON Feb 21 Indonesia's Bakrie Group
expects to complete its long-awaited split from London-listed
coalminer Asia Resource Minerals (ARMS) this month, the
company said on Friday.
Indonesia-focused ARMS, previously known as Bumi Plc, has
struggled with shareholder battles, allegations of wrongdoing
and falling coal prices over the past few years.
To revive the company, shareholders voted to split with the
influential Bakrie family that co-founded the business in 2010,
but finding the money to conclude deal has proved difficult for
the asset-rich but often cash-poor Bakrie family.
They asked this week for a fourth deadline extension and
sought to revise the terms of the deal to reduce the sum they
need to pay, but they now expect to complete the deal
Bakrie Group spokesman Chris Fong said in a text message on
Friday that, while some funds had been diverted for unrelated
purposes, the group was on track to complete the separation.
Under the separation deal agreed last year, the Bakries
agreed to sell their 23.8 percent stake in ARMS for $223
million. They will then use that income plus a $50 million
deposit and an additional $228 million to buy ARMS's 29.2
percent stake in Jakarta-listed miner PT Bumi Resources
, Asia's top thermal coal exporter.
Since they have only managed to raise $163 million of the
$228 million specified in the original terms, they have
requested to reduce the PT Bumi Resources stake they would
receive to 25.4 percent, down from 29.2 percent.
London-listed ARMS said it still believed the revised terms
would be in the interest of shareholders and intended to agree a
further extension to Feb. 26, by which time the conditions for
the separation must be met.
A source close to the company said the Bakries' request to
change the terms of the deal was not a big surprise.
"I wasn't shocked by it as I figured they needed more time.
Both parties want the split to happen, though, so I believe it
will," the source said.
The Bakries founded Bumi Plc in 2010, together with investor
Nat Rothschild, with the aim of bringing promising Indonesian
coal assets to London investors, but their relationship soured.
ARMS shares have lost about three quarters of their value
since their listing.