Borneo Lumbung to acquire stake in Bumi for $1bn

2 November 2011 (Last Updated November 2nd, 2011 18:30)

Indonesian firm Bakrie & Brothers is planning to sell a 23.8% stake in coal producer Bumi to Borneo Lumbung Energi for $1bn.

Indonesian firm Bakrie & Brothers is planning to sell a 23.8% stake in coal producer Bumi to Borneo Lumbung Energi for $1bn.

The company will utilise the amount from the transaction to pay off its $1.35bn debt, reports Reuters.

Borneo Lumbung Energi will receive a loan of $1bn from the Standard Chartered Bank to fund the acquisition.

Under the transaction, Borne Lumbung will hold a stake in Bumi's coking-coal mining unit Asmin Koalindo Tuhup.

Borneo Lumbung Energi, together with Bakrie Group, will own a 47.6% stake, in addition to a 29.99% voting interest in Bumi, on completion of the transaction.