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FACTDROP: Nat Rothschild seeks shake-up at Indonesian mining subsidiary
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11/11/2011

Nat Rothschild seeks shake-up at Indonesian mining subsidiary

Mr Rothschild wrote to Ari Hudaya, chief executive of PT Bumi Resources and a long-term ally of the Indonesia's Bakrie family, Mr Rothschild's partners in Bumi, to say he is not happy with the subsidiary's progress in improving corporate governance.

Πηγή: The Telegraph
By Emma Rowley
Nov 10 2011

Nat Rothschild, the financier behind London-listed mining venture Bumi, said its major Indonesian subsidiary PT Bumi Resources needs a "radical cleaning up".

Mr Rothschild wrote to Ari Hudaya, chief executive of PT Bumi Resources and a long-term ally of the Indonesia's Bakrie family, Mr Rothschild's partners in Bumi, to say he is not happy with the subsidiary's progress in improving corporate governance.

The letter comes after PT Bumi Resources said on Tuesday it had refinanced $600m (£376m) of debt owed to the China Investment Corporation. Mr Rothschild feels that the debt should have been reduced, through monetising some of the $867m "investments and other assets" on its balance sheet, which include loans to connected parties.

Mr Hudaya's dual role as chief executive officer of Bumi itself needed closer scrutiny, Mr Rothschild said.

"Your lack of response to requests both via the board, the audit committee, and in person have left me little recourse but to set out my views formally in a letter, the contents of which I am happy to make public," Mr Rothschild said. "Both myself and the Bakries need an immediate transformation of the way you are choosing to manage PT Bumi Resources."

However, Chris Fong, spokesman for the Bakrie family, who recently had to give up half their stake in Bumi for $1bn cash to avoid defaulting on a separate loan, said Mr Rothschild "hasn't addressed these issues with us".

Bumi last month shelved a $2bn bid to take over a base metals company from PT Bumi Resources, blaming market "uncertainties".

Bumi, in which Mr Rothschild has an 11pc stake, owns 29pc of PT Bumi Resources. Shares in Bumi rose 35.5 or 4pc to 845½p.


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