* Bakries expect Rothschild to stay on after March 26 meeting
* Still seek to add Tan as chairman
* Rothschild meeting with Tan in London “excellent” - spokesman
By Clara Ferreira-Marques
LONDON, Feb 20 (Reuters) - Indonesia’s Bakrie Group, a key shareholder in coal miner Bumi Plc, took another step to defuse a row with financier Nat Rothschild on Monday by saying it expected him to stay on Bumi’s board, even if he is ousted as the company’s co-chairman.
Bakrie Group and partner investor Samin Tan, who together hold 29.9 percent of Bumi’s voting shares, last week withdrew a request for a shareholder vote to remove co-chairman Rothschild and other directors, but said they would still pursue planned changes in the boardroom.
Former hedge fund manager Rothschild, who owns almost 12 percent of Bumi and co-founded the London-listed miner, had been expected to stay on the board in some capacity, even if voted out of the co-chairman position by his Indonesian partners.
But the Bakries’ public acknowledgement that Rothschild will stay on after a meeting on March 26 is the latest sign the two sides have agreed to tone down the recriminations.
The apparent rapprochement is significant, as the latest row had again raised worries over corporate governance at Bumi — recently added to Britain’s FTSE 250 index of mid-range stocks — and revived concerns that the boardroom disagreements could undermine efforts to tap the value of the underlying assets.
Both concerns battered the Bumi share price.
“We are still getting what we want. It is just being approached in a different way. It is not about Nat. It is about a board 100 percent focused on the asset,” a spokesman for the Bakrie Group said on Monday. “For us, it is important about how we are perceived. We want to be perceived correctly.”
A spokesman for Rothschild, who met Tan for the first time on Saturday after the latter held a string of investor visits in London, had made a “great impression” and described the meeting between the two sides as “excellent”.
The dispute at Bumi, one of the world’s largest thermal coal exporters, has been closely watched as the venture, which gave the politically connected Bakries a foothold in the London market last year, prompted debate over deals that reverse foreign assets into a listed shell, not least due to concerns over safeguards to protect minority investors.
Bumi is also seen as a test for investment in Indonesia, with instability at its network of companies seen as a symbol of continued risks of investing in the economy which recently won a return to investment grade status.
The Bakrie spokesman said the group expected its planned nominations to the board — Tan as chairman, Indra Bakrie as co-chairman, Nalinkant Rathod as chief executive and Scott Merrillees as finance director — would be accepted.
All directors will step down at the company’s annual shareholders’ meeting in June and will be considered for election or re-election.
Tensions between the two sides rose late last year as the Bakries believed Rothschild was trying to take over the firm on the cheap, while Rothschild called for a “radical cleaning up” of the miner and its debts in a letter leaked to media in November.
It is not yet clear whether Tan will take up the chairman’s role for the long term, with several industry sources suggesting the answer to Bumi Plc’s boardroom troubles could be to restructure the split chairman’s role and appoint a single independent chairman instead, possibly from among the current independent directors, which include City veteran Julian Horn-Smith.
Horn-Smith and former diplomat and fellow independent board member Robin Renwick flew to Jakarta last week for crisis talks to avoid a public showdown over the board, convincing the Bakrie camp to withdraw their request for a shareholder meeting.
Bumi’s thinly traded shares were down 0.7 percent at 743p by 1540 GMT, having bounced from a low of 727p set earlier this month.