The powerful Indonesian Bakrie family said Friday it would start the process of divorcing from London-listed miner Bumi Plc after winning a crucial shareholder vote over bitter rival Nathaniel Rothschild.
Shareholders shot down a proposal by Rothschild to regain control of the firm in an extraordinary meeting Thursday in London, allowing the Bakries to follow through with their plan to exit the firm and keep their lucrative coal assets.
The Bakries and British financier Rothschild have been embroiled in a bitter fight for control of Bumi since soon after they set up the company in 2011.
The row has highlighted on the pitfalls of doing business in the Asian nation, which has long battled corruption and where questions over corporate governance have often been raised by foreign firms.
Rothschild had been hoping to replace 12 of the firm’s 14 board members — and include himself in the new line-up — saying he had concerns about the way the family was running the business.
However, after winning the vote the Bakrie Group said it was “delighted” that the shareholders showed support for the current board, which last week agreed to allow the Bakries’ to divorce Bumi and buy its stake in Bumi Resources, the firm’s crown jewel and Indonesia’s largest thermal coal producer.
The Bakries now need shareholder approval to finalize their exit plan, which is expected to be a formality.
“We will restart the unwinding process today, and expect a resolution delivered to shareholders for approval as soon as possible,” Bakrie Group spokesman Chris Fong told AFP.
“We do hope Mr Rothschild accepts this, so all stakeholders can be in unison as we head towards a final and acceptable resolution.”
The board said it would now move on the plan by the Bakries to divorce Bumi by returning their 23.8 percent stake in the firm in exchange for a 10.3 percent stake in Bumi Resources.
The family then plans to buy the London-based firm’s remaining 18.9 percent stake in Bumi Resources for $278 million.
The Bakries are one of the most influential families in Indonesia and its patriarch, Aburizal Bakrie, is preparing a run for president in elections due to take place next year.
Rothschild was in March of last year ousted as Bumi co-chairman and resigned from the board in October amid an ongoing spat with the Bakries.
However, the banking scion looks set to continue the fight and push for corporate governance in Bumi, saying in a statement by his NR Investments that he had “grave misgivings over the influence” of the Bakries and their allies.
He added that while “the current board may claim a pyrrhic victory”, independent shareholders were still demanding “new leadership and management, an end to looting and corruption at Bumi”.
Rothschild has repeatedly accused financial irregularities at Bumi Resources.