Robert Friedland joins Rothschild-Bakrie fight over Indonesia coal mines

It was a billion dollar deal that was supposed to bring two famous business dynasties together – one from the East and the other the West.

Nat Rothschild, descendant of the founder of the two-centuries old banking empire, used his family name to get big players – "and big players only" – to back him in a deal to bring a chunk of the vast business interests of the Bakrie family of Indonesia to the City of London.

Listing the coal and other mining interest in London provided the members of Sumatran family – one of whom has a good chance of becoming president of the world's fourth most populous nation – a high profile in the West and at the same time gave Nat, 41, the chance to finally transform his popular image from that of a partying rich kid into a financier with true investment chops.

It was not to be.

Barely two years after listing, Bumi plc is collapsing amid bitter recriminations, allegations of financial impropriety and a downturn in the market. Investors – including according to some reports members of the UK royal family – have lost three quarters of their money.

Rothschild quit the board last month, but today, Nat has come up with a new proposal to save the company.

He has raised $270 million to fund a proposal to sever ties between the Bakries and Bumi Plc and told Bloomberg News today that his proposal "appears to be the only workable solution.” The Bakries have their own proposal worth $1.2 billion and are believed to be open to discussions.

A number of Bumi's top shareholders including Schroders, Standard Life Investments and Abu Dhabi Investment Co. support Rothschild’s proposal, and Nat has also managed to bring on board Robert Friedland, the legendary mining financier, who has agreed to invest $50 million in the venture.

After a string of major successes, Friedland was poised to cap his mining career with the blockbuster $10 billion Oyu Tolgoi copper-gold mine in Mongolia, but he was ousted from his Ivanhoe Mines in April of this year after Rio Tinto took control of the Vancouver-based company.

Friedland bounced back last month raising more than $300 million when he took Ivanplats – an African platinum and copper venture – public in Toronto.