The Bakrie family of Indonesia will sell non-core assets to repay a $437 million loan,
the
Financial Times
reported.
The loan went into default when shares of coal-mining company Bumi, which the Bakries had pledged as collateral, dropped in value. The Bakries have a 23.8% stake in Bumi.
The family said its holding company, Bakrie & Brothers, along with another family company, had agreed on a repayment plan for the loan, which should be paid off toward the end of this year, the
FT
article said.
The value of Bumi shares has fallen by 90% since April 2011 owing to concerns about corporate governance. Financier Nat Rothschild was forced out as Bumi’s co-chairman in March 2012 after he complained about governance issues.
Last year, the Bakries restructured a $1.3 billion loan and sold $1 billion of shares to Indonesian mining tycoon Samin Tan.
Ari Hudaya, president-director of Bumi Resources, has left the Bumi board, according to the
FT
report. The article said this development “could signal a further split between the Bakries on one side and independent directors and London-based investors in Bumi plc on the other.”
The
FT
article added:
The turmoil has damaged the reputation of Aburizal Bakrie, the eldest of the Bakrie brothers and chairman of Indonesia’s Golkar party, which plans to nominate him as its presidential candidate for the 2014 election.
(Source:
Financial Times,
Oct. 1, 2012.)
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