Bumi says coal assets sale plan on track

Jakarta-listed energy firm PT Bumi Resources said on Wednesday that its plan to sell all its coal assets in Indonesia was on track amid reports that there was a rift in the consortium that would buy the assets.

?It (the rift) is a rumor. The assets sale plan is still on track. And we still stick to the plan of using the sale proceeds to develop a coal-to-liquid project,? Bumi?s director Eddie J. Soebari told Petromindo.Com.

Bumi has agreed to sell 95 percent of East Kalimantan?s coal miner PT Kaltim Prima Coal and 100 percent of South Kalimantan?s coal miner PT Arutmin Indonesia and 100 percent of IndoCoal Resources (Cayman) to PT Borneo Lumbung Energi for US$3.2 billion.

Indonesian investment firm Renaissance Capital, which formed Borneo Lumbung Energi as a vehicle company to buy Bumi?s assets, and adviser Credit Suisse, last week launched the first phase of a $2.1 billion debt-raising to fund the deal, which is due to close on June 30.

The Financial Times reported on its website on Tuesday quoted Samin Tan, Renaissance Capital's president, as saying that there are disagreements between Renaissance Capital and potential equity partners that were due to help provide much of the remaining $1 billion.

Marubeni Corp. and Australia's Leighton Holdings Ltd. have been among the names linked to the deal, the report said.

Tan said he had received four offers from potential equity partners, though he refused to identify them, according to the report.

But Tan, who claims to have "exclusivity" over the Bumi deal, complained that those offers carried too many conditions, the report said.

Because of that, Tan said, he was in discussion with a "financial investor" whose offer of bridge financing in the form of convertible bonds was, for the time being, the "most palatable," according to the report. (Godang)