Bumi's boardroom battles take another twist

Under-pressure coal miner Bumi plc has recommended shareholders vote against resolutions put forward by founder Nathaniel Rothschild to get rid of most of the company's directors, saying that the proposed changes are 'not the way forward'.

Under-pressure coal miner Bumi plc has recommended shareholders vote against resolutions put forward by founder Nathaniel Rothschild to get rid of most of the company's directors, saying that the proposed changes are 'not the way forward'.

Rothschild, who himself stepped down from the board in October, has proposed replacing 12 of the 14 current directors in the midst of company infighting with Indonesia's Bakrie family, also co-founders. Through his investment vehicle, NR Investments, he owns an 18.2% stake in the FTSE 250 group.

However, the two boardroom members that would remain after these management changes, Sir Graham Hearne and Steven Shapiro, have revealed that they would not endorse this shake-up and would resign if it goes ahead.

The company said that the key for Bumi plc is to execute the proposed separation of itself from the Bakrie Group and Bumi Resources, in which it holds a 29% stake.

This proposed transactions is currently valued at more than $580m to shareholders through the cancellation of Bakrie's 23.8% stake in Bumi plc, and the disposal of Bumi Resources.

Thesefunds can then be reinvested in the company's 85% controlled subsidiary, Berau, or otherwise deployed to optimise returns to shareholders, Bumi said.

The company concluded: "Your directors are determined to effect the separation of the company from the Bakrie Group and Bumi Resources and move towards restoring shareholder value. A VOTE AGAINST the NR Resolutions enables this to happen. The alternative put forward by Mr.Rothschild will lead to stalemate, continued shareholder infighting and value destruction."

Budianto appointment draws criticismIn a separate statement on Tuesday, the firm said that Eko Budianto will replace Rosan Roeslani as President Director of PT Berau Coal Energy Tbk and its operating company PT Berau Coal.

The appointment of Budianto, who was previously the Director of Operations at PT Berau Coal's mining operations, is another controversial issue for Bumi.

Rothschild has complained that he is not wholly independent as he is linked with the Bakrie family.

Meanwhile, Roselani's departure comes after claims by the Takeover Panel that there had been improper disclosure into his relationship with the Bakries. Roselani owns 9.8% of Bumi.

Recommended

The top funds to invest in
Funds

The top funds to invest in

Investors continued to the passive preference throughout May, while high-yields were also sought. We look at the top funds, stocks and trusts that inv…
5 Jun 2023
The ten highest dividend yields in the FTSE 100
Income investing

The ten highest dividend yields in the FTSE 100

Rupert Hargreaves takes a look at the companies with the highest dividend yields in the UK’s blue-chip index
20 Apr 2023
Best junior stocks and shares ISA platforms
Isas

Best junior stocks and shares ISA platforms

A junior stocks and shares ISA is a great way to save for your child tax-efficiently. But it can be confusing deciding which investment platform to ch…
28 Mar 2023
The outlook for Shell shares is mixed, despite bumper profits
Energy stocks

The outlook for Shell shares is mixed, despite bumper profits

With profits surging, it looks as if Shell is on a roll, but the company’s growth from here is hard to see as Rupert Hargreaves explains.
6 Feb 2023

Most Popular

Best savings accounts – June 2023
Savings

Best savings accounts – June 2023

Interest rates have been creeping up - we look at the best savings accounts on the market right now.
6 Jun 2023
Nationwide to give £100 cash boost to customers
Personal finance

Nationwide to give £100 cash boost to customers

Nationwide Building Society is giving customers £100 as it reinvests profits. Dubbed the Nationwide Fairer Share scheme, we look at who is eligible.
22 May 2023
How much will it cost you to retire early?
Pensions

How much will it cost you to retire early?

The pre-state pension income gap means couples may need an extra £136,000 if they want to retire at 60 – can you afford to retire early?
6 Jun 2023