I've got a deal for you

COAL is so popular that it makes for odd bedfellows. In November Nat Rothschild, a member of a prominent European banking dynasty, announced a tie-up with one of South-East Asia's most controversial tycoons. Aburizal Bakrie (pictured) is the patriarch of a scrum of companies with interests in everything from agriculture to shipping. He is also a powerful politician who may well run for Indonesia's presidency in 2014.

Indonesia is the world's largest exporter of thermal coal. The Bakrie Group controls some of its choicest mines. Since these are conveniently located a shortish sea trip from the ravenous power plants of China and India, they are tempting to investors.

Vallar, a London-listed investment firm founded by Mr Rothschild, is to acquire stakes in two Bakrie-associated coal firms. The deal is complex: it involves a reverse takeover of Vallar by a Bakrie holding company and another Indonesian firm, Recapital Advisors, using cash and share swaps valued at $3 billion. The British firm will hold a 25% stake in Bumi Resources, Indonesia's largest coal producer, and 75% of Berau Coal, the fifth-largest. Vallar will change its name to Bumi plc. Its chief executive and chief financial officer will be Bakrie appointees.

For Mr Bakrie, the deal provides prestige and access to global capital. His firms are indebted—so much so that the credit crunch of 2008 is thought nearly to have crushed them. Bumi's outstanding debt is $3.8 billion, says Dileep Srivastava, a company official. The plan is that the new firm will eventually be large enough to join the FTSE-100 index, triggering a flurry of investment by index funds.

Mr Rothschild and his co-investors gain access to heaps of coal and a web of connections. Mr Bakrie is the chairman of Golkar, a big political party, and is an important ally of Indonesia's president, Susilo Bambang Yudhoyono. Even if Mr Bakrie fails, as he probably will, to become Indonesia's next president, he and his party are likely to remain a strong influence on the government.

But Mr Bakrie is not universally loved in his homeland. He prospered under Suharto, the corrupt autocrat who ruled from 1967 to 1998. More recently, his firms have fought allegations of underpaying taxes. And a mud volcano that erupted in East Java in 2006, burying 14,000 homes, was blamed on a Bakrie oil and gas firm drilling nearby. (At the time, Mr. Bakrie was the minister for social welfare.) Mr Rothschild should prepare for a bumpy mix of politics and business.