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Tan in move to control Asia Resource
From the Financial Times of Tue, 23 Dec 2014 20:32:11 GMT
Asia Resource Minerals

The former chairman of Asia Resource Minerals is trying to wrest back control of the UK-listed coal miner by seeking to appoint new directors after he was forced to cede a substantial stake.

Samin Tan held 47.6 per cent of Asia Resource, the coalminer formerly known as Bumi, until Austria’s Raiffeisen Bank International took control of half of his holding last month, citing the terms of a $224m loan agreement with the Indonesian businessman.

Asia Resource said Mr Tan’s Borneo investment vehicle would now use its remaining 23.8 per cent stake to call a general meeting, at which it would try to secure a boardroom majority for Borneo-nominated directors.

The move is the latest sign of boardroom discontent at the coalminer, whose value has plummeted as the coal market has weakened. Bumi’s reputation was damaged by disputes between its founding shareholders, Indonesia’s Bakrie family and financier Nat Rothschild. A split from the Bakries was engineered this year.

The miner’s sole asset is now its majority stake in Berau, which mines coal in Indonesia. Asia Resource has sought to tighten its control over Berau, announcing on Tuesday a swath of board changes at its subsidiary. Alleged financial irregularities at Berau were previously a factor in shareholders’ loss of confidence in Bumi.

The value of Mr Tan’s holding in Asia Resource has dramatically shrunk, after he invested more than $1bn to acquire his stakes. The miner’s market value is now only about £12m, although Mr Tan received a special dividend of more than $220m after the separation deal.

Asia Resource is also trying to refinance a $450m Berau bond due next year while Mr Rothschild, who remains a substantial shareholder, has suggested he might underwrite a rights issue for the miner.

Shares in Asia Resource fell more than 8 per cent on Tuesday.

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