Another twist in Bumi tale

THE colourful story of embattled Indonesian coal miner PT Bumi Resources has taken another turn – with the company forced to scotch market speculation of a rights issue.
Another twist in Bumi tale Another twist in Bumi tale Another twist in Bumi tale Another twist in Bumi tale Another twist in Bumi tale

Ari Hudaya, courtesy Bumi

Staff Reporter

PT Bumi Resources director Dileep Srivastava put out a statement saying the company had no plan to issue shares with rights.

“The reality is Bumi management is open to various options to reduce debt while enhancing shareholder value,” he said.

“Regarding a non-preemptive issue without rights, we can explore the possibility once we find a notable strategic partner.”

PT Bumi Resources became the focus of an investigation last month launched by its London-listed 29% stakeholder Bumi PLC into “financial and other irregularities”

One area of the investigator’s focus will be Bumi Resources’ development funds.

“The extensive development funds in PT Bumi Resources and the one development asset in PT Berau Coal Energy were marked down to zero in the accounts, except for one investment with a carrying value of $39 million in the consolidated financial statements,” Bumi PLC said in a statement.

The London-based company counts financier Nat Rothschild as a non-executive director and is part-owned by Indonesia’s influential Bakrie family.

Adding to the intrigue, Bumi Resources chief executive officer Ari Hudaya resigned from the Bumi PLC board just hours after it announced the probe.

Bumi PLC has an 85% holding in Berau Coal, which is Indonesia’s fifth-largest coal producer.