Bakrie seeks for another extension, revision in the terms of split
Thursday, February 20 2014 - 01:10 AM WIB
LSE-listed coal miner Asia Resource Minerals (ARMS) said that the Indonesian Bakrie family has asked for a fourth extension to the deadline for a separation from the company, and wants for change in the terms of the transaction due to funding shortage.
ARMS said in a statement obtained late Wednesday that the Bakrie Group has only raised US$163 million rather than the $228 million required to complete the separation transaction on its original terms. ?Therefore, a request has been made by the Bakrie Group to extend further the timetable to completion and for the company to consider revising the terms of the transaction,? ARMS said in the statement.
ARMS, previously known as Bumi Plc, was co-founded by the Bakries and Nat Rothschild in 2010. But relations between the two then soured, with Bumi hit by board room fights, wrongdoing allegations, and falling coal prices, leading to the proposed split with the Bakries.
In the separation deal agreed late last year, the Bakries would sell their 23.8 percent stake in ARMS for $223 million and then use that proceeds plus a $50 million deposit they have paid and an additional $228 million to buy ARMS's 29.2 percent stake in Jakarta-listed coal giant PT Bumi Resources Tbk.
But as the Bakries are finding difficulties in raising the necessary cash to complete the transaction as set out in the original terms, ARMS said the Bakrie Group had asked to reduce the number of PT Bumi Resources shares they would get in the swap to 25.4 percent, down from 29.2 percent specified in the original terms.
?The independent committee of the board believes in principle that these revisions would not be material in the context of the Separation Transaction and therefore that the transaction, if such revised terms are agreed, would remain clearly in the best interests of shareholders,? ARMS said, adding that it intends to agree to move the deadline for the separation from February 19 to February 26.
Editing by Reiner Simanjuntak