Nat Rothschild formed Bumi in early 2011 from a cash shell

NAT ROTHSCHILD last night resigned

from the board of struggling coal group
Bumi with immediate effect, claiming
the firm was failing to act in the interests
of its minority shareholders.
The move is the latest shock for the
investment vehicle Rothschild himself
put together less than three years ago
and which has embroiled some of the
worlds leading busi-
nessmen.
Rothschild said he was
resigning in protest at a
deal proposed by Bumis
key Indonesian share-
holders last week to split
from the firm. In the
terms, the Bakrie broth-
ers called for Rothschild
to give up bonus shares
in the firm worth
around 41m.
In his letter to board
chairman Samin Tan,
Rothschild said that the
deal was so obviously
not in the interests of
minority shareholders
that I find it impossible
to stay on as a director.
He claimed that the
value of the deal is
skewed heavily towards
Tan and the Bakrie broth-
ers, who hold 23.8 per cent of Bumi each
through a joint vehicle after Tan bought
out half of the Bakries stake earlier this
year. The Indonesian arm of London-list-
ed Bumi PT Bumi is currently under
investigation for alleged financial irreg-
ularities.
It appears that you shall be reim-
bursed for your investment at a price of
10.91 a share, whilst other investors see
an estimated return of just 4.30 a
share, Rothschild wrote, calling the
plan a clear breach of the spirit, and I
believe, the letter of the takeover code.
But a source close to Bumi said
Rothschild left after the companys
board turned against him, rather than
on principle. Rothschild jumped before
he was pushed he was
in a minority of one on
the board, the source
told City A.M.
Rothschild brought
the Bakries on board
less than two years ago
in a deal that com-
bined his listed invest-
ment vehicle Vallar
with Indonesian assets
to create Bumi. Shares
have lost almost 75 per
cent in value since
Vallar listed in 2010.
Last night the Bakries
called on Rothschild to
give up his shares
awarded on condition
the deal was a success.
Mr Nat Rothschild
has clearly taken care
of himself without
consideration to oth-
ers, a spokesman said.
Bumi said last night it had received
Rothschilds letter, and the board was
examining the Bakries terms. The inde-
pendent directors are unanimous that a
solution should be examined regarding
a separation. But they have not formed a
view on value, said a spokesperson.
FTSE 100 5,805.61 +12.29 DOW 13,424.23 +95.38 NASDAQ 3,064.18 +20.07 /$ 1.61 unc / 1.24 unc /$ M1.29 -0.01
See Page XX
BERNIE
ECCLESTONE ON
WHY THERE WONT
BE A RACE THROUGH
LONDONS STREETS
BY BEN SOUTHWOOD
NAT ROTHSCHILD
QUITS BOARD OF
TROUBLED BUMI
www.cityam.com
FREE ISSUE 1,739 TUESDAY 16 OCTOBER 2012
FORMULA
GONE
BY TIM WALLACE
RBS mulls float of branches to create challenger bank
RBS is working on a plan to
float the 316 branches it is
being forced to sell off, in a
move that could create a new
high street bank.
The state-owned institution
had hoped to sell the branches
to Santander, but after several
years of negotiations the
bidder dropped out last
Friday.
It needs to sell the unit by
the end of next year to avoid a
fine from the European
Commission.
Inspired by the successful
float of its Direct Line
subsidiary, RBS now hopes it
could spin off these branches
into a new independent bank.
The bailed out bank is
running a dual track
process, where it will
simultaneously work on plans
to sell the branches to other
bidders potentially
including Virgin Money, JC
Flowers and NBNK and to
float the bank as an
independent institution.
However, it is unlikely any
bidder will pay the 1.65bn
Santander had agreed to, and
an initial public offering (IPO)
would bring its own problems.
A float is far from ideal a
retail operation with only 316
branches and a peculiar
geographic distribution would
have a competitive
disadvantage in scale, even
before you get onto legacy
systems issues, said Investecs
Ian Gordon. RBS will pursue a
sale with all vigour, and even
then can expect to drop up to
1bn from the price.
BUSINESS WITH PERSONALITY
Certified Distribution
30/07/12 til 26/08/12 is 128,484
Dear Samin,
I am resigning from the
board of Bumi PLC with
immediate effect...
...You appear determined to
drive through the Bakries
proposal. I believe that this
proposal is so obviously not
in the interests of minority
shareholders that I find it
impossible to stay on as a
Director...
...I am determined to fight for
my fellow investors and can
do that better from outside
the tent...
Yours sincerely
Nat Rothschild
The letter that Nat wrote: How the
tycoon walked away from Bumi
See Page 24
ENGLAND manager Roy Hodgson
has revealed that the amount
of playing time given to his
developing, young players remains
an ongoing significant concern
despite being pleased about the
options at his disposal.
For tonights World Cup qualifier
away to Poland, the England
manager is set to make several
changes to the team that on Friday
defeated San Marino 5-0 at Wembley
where his unexpected inclination to
select the countrys younger players
continued. James Milner, Steven
Gerrard, Glen Johnson, Ashley Cole
and Joleon Lescott are set for recalls
but Hodgson regardless said that he
is continuing to monitor the others
who can compete.
It is nice to know we are
producing some players now who
will challenge, will continue to
improve, will mature with time and
the matches they can play, Hodgson
said. My only fear is hoping these
talents can get enough game time.
Since his May appointment,
Hodgson has given international
debuts to talents like Alex Oxlade-
Chamberlain, Jack Butland, Ryan
Bertrand and Jonjo Shelvey and
called up Kieran Gibbs and Raheem
Sterling, and has spoken of his
willingness to continue to include
younger, less-established individuals.
Hodgson holds
concern over
young Lions
FORMULA ONE boss Bernie
Ecclestone has revealed that his plan
to hold a Grand Prix on the streets of
London is unlikely to get off the grid
because the government will not pro-
vide the multi-million pound
support required.
Ecclestone unveiled lavish plans
for a race route snaking past some of
the capitals most famous land-
marks, including Big Ben and
Nelsons Column, in June, but feels
he has now reached a roadblock.
I dont think the government
would be prepared to put the
required amount of money behind
it, Ecclestone said.
Ecclestone has committed to sup-
porting the race financially rather
than simply charging a hosting fee,
which usually rises to 35m annual-
ly. However, the cost of building
grandstands and readying roads for
F1 would still run into eight figures,
and the government would have to
cover some of this cost.
We would make a large contribu-
tion towards the race, Ecclestone
added. That is whatever it takes to
get it done with all the permissions.
We could help the government and
council with their costs.
Ecclestone dismissed the possibility
of hosting a race around the Olympic
Stadium one of four plans being
considered for the venue insisting a
street grand prix was Londons only
viable option. We wouldnt go to the
Olympic Park, he said. I dont think
anybody [else] is serious about a grand
prix in London.
Central London
Grand Prix off,
says Ecclestone
Ecclestone believes the success of
the London 2012 Olympics should
remind government of the value of
staging elite sport.
I think they did a good job with
the Olympics, he said. It is the first
time I have been proud of England.
They showed that England can do it if
they have to. The population was
behind it. I just think that Formula 1
could do the same job for a lot less.
Lets look at the worst-case sce-
nario, which they wouldnt need to,
and say a race in London costs them
$50m (31m) a year. Over 10 years
that is $500m (311m). What is that as
a percentage of the 10bn they spent
on the Olympics? And you are going
to get good coverage for 10 years.
When you think really and truly,
the F1 industry is British. We have
won more world championships
[than the foreign teams] and it is not
government supported at all.
The Olympics got incredible cover-
age in England. They got 28m viewers
for the opening, which is near half
the population, so it was good. And
even that guy who ran very quickly,
22m watched him. It is unbelievable.
F1 is the worlds most-watched
annual sport, with 515m viewers last
year. The Olympic mens 100m final
attracted around 1bn viewers.
FERRARI chiefs have denied
reports that world champion
Sebastian Vettel is poised to join
them from Red Bull in 2014.Ive
always said I dont want two
roosters in the hen-house, said
principal Luca Di Montezemolo on
the possibility of Vettel joining
Fernando Alonso. I dont like that
and it creates instability.
IN BRIEF
Harrison weighs up retirement
n BOXING: British former Olympic
champion Audley Harrison, 40, admits
he is considering retirement after
Saturdays 82-second defeat by David
Price. Ill take some time to think this
out, Harrison added.
Reds chief defends Anfield plans
n FOOTBALL: Liverpools spending
power will not suffer from plans to
redevelop Anfield rather than build a
new stadium, insists managing director
Ian Ayre. The whole point is to actually
increase our revenues, he said.
HUGHES RIDES TO SEVENTH HEAVEN AT WINDSOR
JOCKEY Richard Hughes yesterday secured seven victories from an eight-race card in an
incredible feat given bookmakers odds of 10,168-1 at Windsor. The 39-year-old is the
second rider to do so at a UK event Frankie Dettori was the last at Ascot in 1996. He
won the first five races before finishing third in the days sixth and winning the final two,
the last riding Mama Quilla. He said: Every day my kid says, How many winners today?
Six or seven?. I tell him I wont ride that many, but I have today.
ENGLAND cricket officials have
attempted to draw a line under
their spat with South Africa over
the Kevin Pietersen text message
saga, but admit some differences
remain unresolved.
South Africa chiefs were
infuriated when David Collier, chief
executive of the England and Wales
Cricket Board (ECB), earlier this
month accused Proteas players of
deliberately provoking Pietersen.
The ECB yesterday said an apology
had been accepted by their South
African counterparts, but conceded
that they remained at odds over how
the episode, which threatened
Pietersens England career, unfolded.
England and South Africa bury
hatchet almost over KP row
Although the two boards do not
agree on the sequence of events
regarding any responses to messages
between Kevin Pietersen and certain
Proteas players, CSA and SACA
accept Mr Colliers apology based
upon his earlier utterances that the
team may have acted in a way which
was underhand, read an ECB
statement. Both CSA and ECB
regard this matter as now closed.
Pietersen is set to meet England
coach Andy Flower today in London
as he begins his reintegration to the
camp, having been dropped for the
final Test of the summer series
against South Africa and then left
out of the squad for this months
World Twenty20 in Sri Lanka.
A DECISION on the future of the
Olympic Stadium has been
postponed, prompting fears that its
planned reopening in 2014 could
also be delayed.
David Gold, chairman of West
Ham, who are favourites to be made
anchor tenants, wrote on Twitter last
night: Sadly the decision on the OS
has been postponed. We must be
patient but resolute.
The London Legacy Development
Corporation, which had been tipped
to choose between four bids this
month, met yesterday. It is thought a
European Commission probe into
state aid to football clubs could yet
further complicate the decision.
Fresh delay in
stadium saga
BY FRANK DALLERES
TUESDAY 16 OCTOBER 2012
24
BY DECLAN WARRINGTON
BY FRANK DALLERES
SPORT
I have crossed the Alps barefoot
and I have overcome many difficult
situations in my career
Republic of Ireland manager Giovanni Trapattoni on
speculation surrounding a potential exit from the role

@cityam_sport
Results
NP0WEP LEACbE 2
Pert Va|e ...................... (I) J 0xIer4 0t4 ................. (0) 0
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Be||am 1 Scat|+r.............................................................................................
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Orcap A. V+cear|+ 1 Ser||+ (.JO). Orcap B. O/ec| Rep 1
Ba|+r|+ (pm), lt+|] 1 Derm+r|. Orcap O. Aastr|+ 1
K+/+||st+r (.J5), Oerm+r] 1 SWeer. Orcap D. Ararr+ 1
Estar|+ (opm), Har+r] 1 Tar|e] (.JO), Ram+r|+ 1 Ha||+r
(pm). Orcap C. A||+r|+ 1 S|a1er|+, O]pras 1 NarW+] (opm),
lce|+r 1 SW|t/er|+r (.JO). Orcap |. lsr+e| 1 latem|aar
(5pm), Rass|+ 1 A/er|+|j+r (4pm). Orcap O. Basr|+H'1|r+ 1
l|t|a+r|+ (pm), l+t1|+ 1 l|ec|terste|r (opm), S|a1+||+ 1
Oreece (.JO). Orcap H. S+r V+r|ra 1 Va|a1+ (.JO),
U|r+|re 1 Varterera (pm). Orcap I. Be|+ras 1 Oear|+
(5pm), Sp+|r 1 |r+rce (8pm).
Carcpear UZI Ol'slip Pla]Off Seccr |e. Ser||+ (O) 1
Er|+r () (5pm).
POLAND: THE FACTS
nPoland are ranked 54th in the world
after their first-round exit at Euro 2012
and a win and a draw in Group H of the
2014 World Cup qualifiers
n Since Euro 2012, they have won both
home fixtures: 2-0 vs Moldova, and
1-0 vs South Africa
n Borussia Dortmunds Robert
Lewandowski, who last season scored
30 goals, and Lukasz Piszczek are key.
EXCLUSIVE
BY CHRISTIAN SYLT
cityam.com/sport