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Last updated: February 18, 2013 7:21 pm
The board of the Indonesian coal miner battling Nat Rothschild for control of the company has strengthened its position ahead of a crucial shareholder vote, stacking the odds against the UK financier at a long-awaited showdown on February 21.
While Bumi’s main Indonesian shareholders – the Bakrie family and businessmen Samin Tan and Rosan Roeslani – had jointly owned 58 per cent of shares in the company, their voting power at Thursday’s extraordinary shareholder meeting was to be capped at 29.9 per cent after the UK’s Takeover Panel ruled that the three parties were acting in concert.
Mr Roeslani, however, on Monday sold his his 10 per cent economic stake in Bumi, which provides 13.4 per cent of voting rights, to three new investors who will be able to vote their stakes, raising the board’s likely support from 30 per cent to 40 per cent ahead of the vote. Two of the three new Bumi investors, Avenue Asia Capital Management and the Tanoesoedibjo family, have prior relationships with the Bakrie family.
Avenue Asia Capital, a New York-based fund manager that focuses on distressed companies, was a major shareholder in the Bakrie’s property group and had a seat on its board until 2011, according to the company’s annual report. The Tanoesoedibjo family’s MNC group, meanwhile, agreed at the end of last year to buy some of the property group’s toll roads.
As speculation swirled about Mr Roeslani’s 11th-hour share sale over the weekend, a spokesman for Mr Rothschild said on Sunday that “this seems an effort by the concert party to thwart the clear wishes of the majority of independent minority shareholders”.
A spokesman for the Bakries said that the family had no prior knowledge of the sale by Mr Roeslani, whose shares had a market value of about £95m. “We have no influence on how Mr Roeslani manages his investments,” the Bakrie spokesman said.
Mr Roeslani, MNC group and Mr Rothschild could not be reached for comment on Monday. Avenue Capital declined to comment.
‘Different ball game’ ends
In December 2010, a month after Rosan Roeslani agreed to reverse his 75 per cent stake in Indonesia’s fifth largest coal mine into Nat Rothschild’s London-listed Vallar vehicle, he was asked by the Financial Times for his reasons, writes Christopher Thompson.
“How can you decide if someone [Mr Rothschild] is a nice guy after only one week [of knowing him]?” asked Mr Roeslani, before reclining in a dimly lit basement wine bar at the Four Seasons hotel in Jakarta. “The deal was enough to convince me in itself ... we see this as an opportunity to go into a different ballgame.”
Mr Roeslani may now be ruing such decisiveness.
On Monday, Mr Roeslani’s company, Recapital, sold its remaining shares in Bumi, the company formed when stakes in coal mines associated with the Bakrie family were also reversed into Vallar. Since his FT interview, those Bumi shares have lost more than 60 per cent of their value. Mr Roeslani could not be reached for comment.
Mr Roeslani founded Recapital in 1997 and his business dealings with the Bakries go back to at least 2001, when he said he advised the family on a mining acquisition and later the purchase of the Kaltim Prima Coal mine, Indonesia’s largest thermal coal mine and the jewel in the crown of Bumi Resources.
But the UK Takeover Panel ruled that this relationship was too close to allow Mr Roeslani to exercise his share’s voting rights. The panel concluded that the Indonesian business partners were acting in concert and, as a result, Mr Roeslani’s voting block would be folded up into the Bakries’ 29.9 per cent share.
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