Reuters reported that Indonesia's Bakrie Group is set to announce a deal led by Indonesian investors PT Renaissance Capital by Tuesday to avert a default on a USD 1.345 billion loan after talks with commodity giant Glencore fell through.

As per report, Renaissance Capital, led by Indonesian investor Mr Samin Tan, is expected to provide financing to reduce the debt by USD 1 billion in exchange for an equity stake in London listed coal miner Bumi Plc.

The source said Indonesian coal miner Borneo Lumbung Energi, controlled by Mr Tan, may get the stake in Bumi Plc, effectively becoming another holding firm, though the structure of the Bakries' latest deal was not clear.

The deal, which would keep control of the Bakrie Group's world class mines in Indonesian hands, is part of its attempts to refinance the loan it obtained in March this year to consolidate its debts. Credit Suisse arranged the debt against the Bakrie Group's 47% stake in Bumi Plc, and lenders included the Swiss bank and a group of hedge funds.

Glencore is no longer in talks with the Bakrie Group after having been the frontrunner ahead of rival trader Vitol in a deal to provide a loan in exchange for greater commodity marketing rights. It was not clear why the Glencore deal fell through. Glencore, which already markets Bumi coal, was interested in refinancing, but did not want an equity stake, a source familiar with the matter said. It is also unclear if there are other investors behind Renaissance.

(Sourced from Reuters)