Bumi plc director urges Rothschild to hand back bonus shares

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LONDON (ShareCast) - Senior independent Non-Executive Director of Bumi plc, Julian Horn-Smith, on Monday called on co-founder Nathanial Rothschild to return some bonus shares in the mining firm.

Rothschild was granted the shares as a reward following the transaction which created the FTSE 250 (FTSE: ^FTMC - news) company.

"It is now clear that the deal and deal structure which Nat proposed and championed for Vallar plc has resulted in considerable losses for many shareholders. Following meetings with shareholders over the past few weeks there is growing pressure from them for Nat to return these shares," Horn-Smith said in a Statement.

"The board believes it is unjust that Nat should be able to continue to own and vote these shares which he received as the result of a flawed transaction. It is wrong for failure to be rewarded and this bonus should be clawed back."

Bumi plc was listed on the London Stock Exchange (LSE: LSE.L - news) in 2010 and was founded through Indonesia's Bakrie family and Rothschild's shell company Vallar plc.

However Rothschild stepped down from the board in October in the midst of company infighting with the Bakries over control of the firm.

Last week Rothschild proposed replacing 12 of the 14 current directors. However Bumi plc advised shareholders against the vote, saying that it was "not the way forward".

The company said that the key for Bumi plc is to execute the proposed separation of itself from the Bakrie Group and Bumi Resources, in which it holds a 29% stake.

The proposed transaction is currently valued at more than $580m to shareholders through the cancellation of Bakrie's 23.8% stake in Bumi plc, and the disposal of Bumi Resources.

The funds could then be reinvested in the company's 85% controlled subsidiary, Berau, or otherwise deployed to optimise returns to shareholders, Bumi said.

The company said in a statement last week: "Your directors are determined to effect the separation of the company from the Bakrie Group and Bumi Resources and move towards restoring shareholder value. A VOTE AGAINST the NR Resolutions enables this to happen. The alternative put forward by Mr. Rothschild will lead to stalemate, continued shareholder infighting and value destruction."

RD