Rothschild escalates dispute with Bumi board
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Your support makes all the difference.The financier Nat Rothschild has escalated his long-running dispute with the board of Bumi, after claiming that the latest results from a key subsidiary of the Indonesian coal miner he co-founded lacked credibility.
Bumi Resources, in which the similarly-sounding parent company Bumi owns a 29 per cent stake, announced a $632m (£388m) loss for the first nine months of 2012, compared with a $175m profit a year earlier.
The Bumi subsidiary said that the loss was largely down to a $422m charge on derivative transactions which it described as "book losses" necessitated by accounting policy adjustments. However, Rothschild, who has been mired in disputes with Bumi's top brass for months over the running of the company, indicated that the derivative charge looked incredible.
"To keep hiding behind derivatives transactions time and time again fools nobody. Why should a simple coal-mining company experience such swings [in profitability] due to 'book losses'. It's simply not credible," said Rothschild, who owns about 12 per cent of Bumi.
Last year, Rothschild, pictured, was ousted as Bumi's co-chairman and later stepped down from its board as his relations soured with key shareholder, the Bakrie brothers, and other major investors and executives. Rothschild and the Bakries have put forward competing visions for the group, both of which the board has rejected.
Bumi's 29 per cent stake in Bumi Resources dates back to November 2010 when the group was created by the injection of some of the Bakrie brothers Indonesian coal mining assets into Rothschild's London-listed cash shell.
There was a fall of almost 5 per cent in shares in Bumi Resources. Shares in Bumi Plc also also saw a slight fall in London to 273.2p.
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