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ndonesian conglomerate PT Bakrie & Brothers, Tbk (BNBR) and Bakrie-related entity Long Haul Holdings say they inked a deal on Monday night to sell a 23.8 percent stake in London-listed Bumi Plc to hard-coking coal producer PT Borneo Lumbung Energi & Metal, Tbk (BORN) for US$1 billion.

“The deal will help us to pay off the bulk of a $1.345 billion loan to Credit Suisse,” Bobby said.

After the agreement came into force, Bakrie Group and BORN would continue to hold a 47.6 percent stake in Bumi, a new joint venture between the Bakrie Group and British investment giant Vallar Plc that was established by financier Nathaniel Rothschild, he added.

The transaction valued Bumi’s shares at £10.91 ($17.43), a 46 percent premium over their closing price on the London Stock Exchange on Oct. 28 and approximately a 45 percent premium over the last 20-day volume weighted average trading price, the Bakrie Group said in a statement.

The sales value also represented approximately a 5 percent premium on the last six months’ volume weighted average trading price of approximately £10.34.

The group is expecting to complete the transaction around the end of December following BORN shareholders approving the transaction and satisfying regulatory and approvals.

Eddy Soeparno, the BNBR chief financial officer, said that the agreement would also help decrease Bakrie Group’s loan from Rp 10.2 trillion ($1.15 billion) to Rp 5.5 trillion by the end of the year.

However, Bakrie Group executives declined to comment on their discussion with the world’s biggest commodities trader, Glencore, about a new financing facility that might provide the group with $800 to $900 million.

It was reported earlier that Bakrie and Glencore were almost close to a financing deal to repay Bakrie’s debt.

Samin Tan, president director of BORN, said that the transaction created a very strategic partnership between two leading mining groups in Indonesia.

 “We will gain access to the growing thermal coal industry through a well-established and major platform,” Samin said.

“The transaction also provides BORN with exposure to a high quality metals portfolio, thus transforming BORN from a pure coking coal producer into a world class diversified natural resources producer.”

He also said that BORN has proven mine development skills from the greenfield through to the production stage and that the company looked forward to working with and supporting current management across the Bumi Plc. group to execute development plans for new projects at Dairi Prima Minerals, Gorontalo Mining, and Bumi Mauritania as well as achieving synergies and efficiencies across the coal division.

 “We are strongly committed to creating shareholder value at all levels from BORN to Bumi Plc. and its subsidiaries and associate companies,” Tan said.

To support BORN’s partnership with Bakrie Group, the coal miner was financed through a $1 billion five-year amortizing term loan facility provided solely by Standard Chartered Bank. (nfo)