Nat Rothschild received a potential boost in his battle over the future of coal mining company Bumi (Other OTC: VLLRF - news) , as the Takeover Panel ordered rival shareholders to reduce their influence over the company.
The Bakries, the Indonesian brothers with whom the financier has fallen out, are acting “in concert” with a company controlled by fellow Indonesian shareholder Rosan Roeslani, the Panel ruled.
In a further twist, the Panel said it would investigate why it had not been alerted to the concert party earlier, while the Bakries said they had complained to the Panel over Mr Rothschild’s conduct.
As a result of the Panel’s decision, the Bakries and Mr Roeslani who both injected assets to create London-listed Bumi were ordered to sell shares to reduce their voting power.
The Bakries were already being treated as acting in concert with another Indonesian investor, chairman Samin Tan, with whom they hold Bumi shares in a joint venture. But with Mr Roeslani the parties together had a 43pc voting stake, which must now be reduced to under 30pc.
The ruling could hand Mr Rothschild a greater say over the company as he and the Bakries, with whom he launched Bumi in London, clash over its future. Bumi’s board yesterday said Mr Rothschild’s plan to cut ties with the Bakries and their allies is “undeliverable”, as Mr Roeslani and Mr Tan do not want to comply with his condition they sell out.
Nonetheless, should Mr Rothschild pursue his proposal, he could be in a better position to mobilise support, given his rivals’ more limited voting power.
A spokesman for Mr Rothschild’s NR Investments said: “We welcome this ruling, and intend to continue pursuing discussions with members of the ... concert party in an attempt to reach a consensual solution that will be in the interest of all Bumi plc shareholders.”
Ahead to the ruling, the Bakries were already expected to reduce their influence, through a “divorce” deal which would see them cancel their shares. The Bakries said: “As it now stands, we are caught in an unjust situation where holders of some 57pc of the equity [the Bakries, Mr Tan and Mr Roeslani] in Bumi are currently (and collectively) restricted to only 29.9pc of the votes.”
Meanwhile, the Panel announced it was investigating why it had not previously been made aware of the concert party, and why waivers excusing the concert party from having to make an offer for Bumi were not sought.
The Bakries hold Mr Rothschild responsible for negotiating the company’s structure with the Panel.
Mr Roeslani, who resigned from the board following the ruling, said “Nat Rothschild designed the structure”, alleging via a company statement that Mr Rothschild wanted the acquisition of the Indonesians’ assets “to be announced simultaneously because he would get more free shares”.
However, a source close to NR Investments said the board of Vallar, which became Bumi, “chaired at the time by Sir Julian Horn-Smith, [had] approved the acquisition in November (Xetra: A0Z24E - news) 2010, on the basis of advice from its legal and financial advisers, who led all interactions with the Takeover Panel on behalf of the Vallar plc board ... [which] was not made aware of any concert party issues.”